text: And lastly, at least for now, the fifth factor that makes the Fed’s 2% inflation target unachievable is government spending. Jason Furman, chairman of the Economic Council under former President Barrack Obama, said yesterday that the student loan forgiveness scheme is likely to boost inflation by 0.2-0.3%. New government spending under the Inflation Reduction Act could end up being inflationary due to the hundreds of billions of dollars in new government spending. To reiterate one of my main points over the last 18 months, government spending is what drove the Great Inflation, which lasted from 1968 to 1982. President Lyndon Banes Johnson’s administration didn’t want to cut Great Society spending (Biden’s Build Back Better) and couldn’t cut spending on the Vietnam war, even though economists knew both were driving significant inflation. The Biden administration is repeating the mistakes of LBJ.My current outlook remains that 1) this is a new inflationary regime and we’re not going back to 2% inflation – maybe not even in my lifetime – and 2) a recession is already baked in. Economists can quibble about a recession being “technical” or not, but forward-looking indicators show an economic slowdown pointing to a recession. Most recently, the U.S. housing supply ran over a 10-month supply, which has happened in every recession since 1973. It may be the case that some data points bolster economic growth in the second half of this year, and the U.S. eeks just above 0.0% economic growth, but I believe a recession is imminent if not already here. And inflation is just here to stay for the five reasons I mentioned above. As I’ve been reporting since 2017, stagflation is likely to stay with us for most of this decade. – M.S.INSIDE THE BELTWAYWHITE HOUSE: Following student loan debt forgiveness yesterday, President Biden is scheduled to give another speech today at a Democratic National Committee event.CONGRESS: Nothing Significant to Report (NSTR)FAUCI, HHS INSTRUCTED TO PRESERVE DOCUMENTS: In a letter to Health and Human Services Secretary Xavier Becerra, Sen. Roger Marshall (R-KS) instructed HHS to “preserve all record and information” related to Dr. Anthony Fauci’s tenure as Chief Medical Advisor to the President. The letter reminds HHS that government employees have “legal responsibilities to collect, retain, and preserve all documents, communications,” which also extend to “official and personal [email] accounts or devices, burner phones, including records created using text messages, phone-based message applications, or encryption software.” The letter goes on to accuse HHS of possibly having “already failed its obligations to meet its record preservation requirements” after a previous investigation found that the National Institute of Health shredded documents pertaining to funding foreign bioresearch labs. (AC: Should the GOP take the House majority in November, Republicans will likely attempt to drag HHS officials and Fauci through lengthy investigations into controversial research conducted with U.S. taxpayer money, including at labs and facilities abroad, as well as vaccine mandates and other potentially damaging actions. There are strong doubts that potential wrongdoing will be adequately punished, but Republicans are likely to use their majority for the next two years to continue retaliatory investigations started by Democrats into the Biden administration. – M.S.)DOMESTIC INTSUMFOOD & AG: Corn futures are up for seven straight sessions over reduced crop yield. In addition to fewer acres, corn yields are expected to decrease on a per-acre basis from last year by approximately 3%.ENERGY: NSTR