Cook The Books: Fed Chair Kevin Warsh Is Tweaking The PCE Inflation Gauge To Make The Data Look Better
Warsh announced new task forces he’s launching to take a fresh look at various aspects of how the Fed operates. One of them is on inflation, including how it’s measured.
Government and Fed-approved economic data has shown that inflation is once again on the rise; but independent data reveals true inflation has been and is much higher than the government cares to admit.
Under the Trump White House, The WinePress has documented a number of instances of the administration manipulating, rigging and underreporting key economic data.
Last September, Trump fired the head of the Bureau of Labor and Statistics because the numbers, according to Trump, were not favorable, and installed a new chief to provide more favorable data. Or during the government shutdown last year, when the administration said they were not going to post key monthly information.
The White House is also secretly tallying robots as created jobs, which of course is going to skew the data to make it appear as if more physical Americans are working when they are not.
Trump has also requested that corporations no longer be required quarterly earnings reports and instead only do so twice it year, as the economic woes continue to become harder and harder to paper over.
Despite all of this, as pressure builds on new Federal Reserve Chair Kevin Warsh to address interest rates, perhaps hike them, which would defy Trump’s demands of vastly lowering interest rates, Warsh is now looking to manipulate the data some more in the administration’s favor.
First reported by Bloomberg:
A coming revamp of the Federal Reserve’s preferred inflation gauge could be just enough to tip the scales against interest-rate increases this year, even if it doesn’t dramatically alter the overall picture on prices.
That’s the early assessment from economists running the numbers on an annual update of the personal consumption expenditures price index that is due in September from the Bureau of Economic Analysis. Several said the planned changes would have likely lowered core inflation anywhere from about one-tenth to nearly three-tenths of a percentage point if they’d already been applied to the latest data.
The PCE price index rose 4.1% in May from a year earlier, the most since April 2023 and far above the US central bank’s 2% target. The core PCE reading — which policymakers lean on given it excludes volatile food and energy prices — rose by 3.4%.
Fed officials were nearly unanimous at their last policy meeting in June that risks to the inflation outlook remained to the upside. But given how evenly split they were on the need for a rate hike in 2026, a downward revision to PCE at just the right time could help new Fed Chairman Kevin Warsh and the doves hold the line.
“The case for the Fed remaining on hold has strengthened substantially,” said Stephanie Roth, the chief economist at Wolfe Research. In addition to the planned PCE update, she also pointed to the recent slump in oil prices from the height of the Iran war in April and May and the latest jobs report, which showed momentum in the labor market over the last few months may have been overstated.
The BEA in a recent article gave a preview of the tweaks, which will include changes to how prices are measured for certain categories — including legal services, computer software and investment advice — which have drawn scrutiny because of their outsize impact on the index. Economists at Citi, in a June 30 report, described the pending updates as “a big deal.”
[…] Warsh, at the June 17 press conference, announced new task forces he’s launching to take a fresh look at various aspects of how the Fed operates. One of them is on inflation, including how it’s measured. In the past, he’s also signaled a preference for a “trimmed mean” measure of inflation that excludes the most volatile components at any given time.
Truflation created a new chart that roughly maps what Warsh’s new inflation data would look like, and it’s lower than what the Fed was already publishing:
AUTHOR COMMENTARY
Proverbs 12:19 The lip of truth shall be established for ever: but a lying tongue is but for a moment.
The data and information put out by the government and the Federal Reserve has been fake and manipulated for many, many years; each administration tweaking certain things to make themselves look favorable. Now that the house of cards is about to collapse, the Titanic is about ready to break in half, Trump and his buddy Warsh — another card-carrying member of the Epstein Class — are going to say and do whatever they can to jerry-rig the data to make things look great, while also justifying interest rate cuts moving forward.
The machine wants you to go mad; they do not want you to trust your eyes and ears, what you feel, what you sense. You know something is massively awry, but they need you to be a blind and willful participant in the bread and circuses…
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Always tweaking, always cooking the books.
For me anyway, I don't pay any attention to the numbers they put out. They're phony
Thank you!🙂
https://www.youtube.com/watch?v=P41IcK7aZl8
Thomas Jefferson’s Untold Prophecy on Central Banks Revealed
The central bank is unconstitutional, said Thomas Jefferson to Alexander Hamilton.
They can fly an airplane, but they can not run a country and keep it from crashing.