US financial experts say that the country's prospects for 2022 financial markets are generally encouraging. The US supply chain in 2021 is, however, too snarled for what has been called "the Biden Christmas fix," analysts say. According to Reuter's news, US President Joe Biden is actively pushing to tame rising prices and ease supply shortages well before Christmas- this would be an ideal Christmas gift for all Americans in the month of December. Reuters says that the unsnarling US supply chains seem to stand between the President and his noble desires.
Recently, President Biden summoned all key powerbrokers from the union, ports ad big business. The main agenda was to address labor, warehousing, and shipping pain in the greater US supply chain. At this forum, the President announced a new plan for a 24-hour port operation in Los Angeles. As the President's Republican opposition seized the opportunity for criticism over the "Christmas gift" and tried to connect his policies to inflation, the message from the Whitehouse was clear: Genuine solution is in sight. The Republicans hope that an anticipated Christmas shortage would help them in efforts to stall the Congress-driven multitrillion-dollar spending. They hope they can achieve this in the next few weeks.
But the President has a peaceful message for his detractors: "We're offering a commitment across the board that we're going to a 24/7 mode," the recently installed Democratic Party leader said. President Biden said the first big step in this endeavor is the port opening and a commitment from retailers like Walmart and Target to move more merchandise at night. He called on the rest of the private sector chain to help make the process a success.
Undoubtedly, the fact that there's more cooperation among the perennially competing and secretive US supply chain players is one huge plus. However, logistical experts warn that the efforts by the White House may only be incremental at best. Many US labor unions and economic experts concur with this view. The Chief Economist at the Mizuho Securities, Mr. Steven Ricchinto puts it succinctly: "The actions and intentions of the President aren't really going to hurt; regardless, at the end of the day, this is not a solution to the nagging problem."
Overall, Americans (who are actually the world's biggest consumers) have simply been on a buying spree, buying much more goods during the pandemic. Notably, much of these goods are imported products. If you couple this with equipment shortages, lack of storage space for the goods, and labor shortages, you have a mind-boggling situation. Most of the key players- from the retail chains to the ports- are already working full throttle to deal with the pandemic-driven fuel surge in imports. This is how they hope to get the "Christmas gifts" onto the shelves and e-commerce centers, just in time for the Black Friday kick off on November 26th. This would also kick off the US holiday season.
On the persistent, high inflation issue in the US, analysts note that gold now holds the biggest gain; as we advance to the end of 2021. A Bloomberg news report recently indicated that gold is edging higher, taking advantage of a weaker dollar. This happened after the precious commodity's biggest advance in over 7 months. Most investors weighed their worries around the looming cut down in stimulus and stubbornly high inflation.
In September 2021, the US consumer price indexes significantly rose by more than what the pundits forecast. This fuelled the resumption of a faster growth pace, underscoring the continuity of inflationary pressures in the national economy. Subsequently, the yield on the 10-year Treasuries declined after an initial increase; this followed the release of the most recent data. It further boosted a soaring demand for the non-interest-bearing bullion.
A commodity analyst at the UBS Group AG, Mr. Giovanni Staunovo had this to say: "When real interest rates fell, it significantly supported gold. Indeed, the dominant perception in the market suggests that inflation might stay elevated for much longer." The October 2021 data further showed that China's factory-gate prices significantly grew; they grew at the fastest imaginable pace in almost 26 years. This added to the risk of global inflation. Economic stakeholders expected that the US producer index would be released later on in the month.