Inflation figures could be government 'gaslighting', true inflation is 2-3 times higher - Michael Wilkerson

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(Kitco News) - The government is "gaslighting" the American public on inflation, according to Michael Wilkerson, CEO and Founder of Stormwall Advisors and Author of Why America Matters: The Case for a New Exceptionalism, who claims that the Bureau of Labor Statistics's Consumer Price Index is not an "accurate" reading of inflation.

"Inflation is running two to three times what the CPI data are showing in those key categories, in food, in electricity, in higher education, in medical care," he told Michelle Makori, Lead Anchor and Editor-in-Chief at Kitco News.

Wilkerson, who has more than two decades of experience in finance and consulting, used data from non-government sources, such as The Brookings Institution and PricewaterhouseCoopers (PwC), to support his thesis.

For instance, official CPI data imply that healthcare costs have risen 2.6 percent per year over the last decade, while PwC suggests that they have risen by 7.6 percent per year since 2006.

Wilkerson's comments come after the latest CPI release, which reports that year-over-year inflation was 4 percent in May of 2023, down from 4.9 percent in April, and well below the recent peak of 9.1 percent in June of 2022.

Wilkerson forecasts that inflation, as measured by CPI, could reach as high as 12 percent by the end of 2023, claiming that this would occur due to both monetary and supply-side phenomena, particularly due to oil price shocks.

"The real driver of the decline [in inflation]… is the decline in energy, specifically gas and oil [prices]," he observed. "I do think we're likely to see price movements back up towards where it was at the beginning of the year."

To find out why Wilkerson thinks oil prices will go higher by the end of the year, and how he is investing, watch the video above

Oil

Saudi Arabia intends to cut its oil production by 1 million barrels per day. Other members of the Organization of Petroleum Exporting Countries (OPEC), which account for 40 percent of global crude oil production, have said that they plan to cut production into 2024.

This, combined with the growing influence of the BRICS alliance (Brazil, Russia, India, China, and South Africa), could exert upward pressure on oil prices, said Wilkerson.

He added that "BRICS-plus is not in a mood to be friendly," and that they will "make decisions that are in their interests', and not in ours'."

The BRICS have negotiated more bilateral trade agreements after the weaponization of the dollar, following Russia's war with Ukraine. Recently Pakistan, which has expressed interest in joining the BRICS, bought discounted oil from Russia, paid for in Chinese yuan.

To find out how high Wilkerson thinks oil prices could go, watch the video above

Gold

As the U.S. economy faces the possibility of more inflation, as well as a potential recession and more bank failures, Wilkerson claimed that the "stars are aligning for gold."

"I'm sticking with the conviction over the long-run that it is something I believe will perform," he said. "If you stick with my hypothesis that… we're going to see some movement in energy and some movement in inflation beginning in the Fall, then yes, I think there is a plausible scenario that we could see gold back above $2,000 by the end of the year."

To find out Wilkerson's thoughts on gold miners, watch the video above

By

Cornelius Christian

For Kitco News

cchristian@kitco.com

www.kitco.com/

Michelle Makori

For Kitco News

mmakori@kitco.com

www.kitco.com