text: Turning to Gross Domestic Product (GD), the US finished last year at an overall 5.7%. Economic growth is already decreasing. First quarter numbers won’t be published until 30 March, however, the Atlanta Fed’s GDPNow is projecting an annual rate of 1.2%. I should note that this is subject to change week over week.The TIPP Economic Optimism Index is still pointing downward. Meanwhile, the Empire State Manufacturing Survey tends to be a leading indicator of GDP growth. It’s also pointing down.Finally, we wrap up with a quick look at logistics. We see wait times at two of America’s busiest ports – Long Beach and Los Angeles – have receded from 15-25 days last year to just 2-3 days as of yesterday (bottom two charts, above). All around great news, however, we’re also seeing some disruption at major Chinese ports. Chinese authorities are back to enforcing lockdowns in Shenzhen, although the Yantian port remains operational. Still, future lockdowns could lead not only to more shipping delays but also increases in Far East to West Coast Freight-of-All-Kinds (FAK) shipping costs (top left in chart above). In conclusion, don’t expect inflation to moderate just yet. CPI is likely to remain elevated and may continue to increase, especially with the high PPI numbers. Summer months typically bring increased consumer demand, and we’re heading into a global food crisis. Prices will remain high through at least this year. – M.S.ECONOMIC WARNING INTSUMDollar’s doom is greatly exaggerated… for nowThis week, the Wall Street Journal reported that Saudi Arabian officials are considering the use of the Chinese yuan in foreign oil sales. The news preceded a flurry of social media activity about the dollar’s imminent loss of its world reserve status. But there’s good reason why most of the reaction this week has been an overreaction. For additional background, see the 03 March 2022 InFocus: When in doubt, zoom out: a quick look at the strategic monetary picture (https://forwardobserver.com/early-warning-when-in-doubt-zoom-out-a-quick-look-at-the-strategic-monetary-picture/).To recap, the US dollar (USD) will eventually lose its status as the world’s sole reserve currency, but it’s unlikely to happen overnight. We know this is most often a decadal process, and one I believe is already happening gradually. What’s more likely is that the Chinese are successful in slowly displacing the USD as the only global reserve. The two may share status for part of this decade, with the dollar being the more dominant of the two currencies, due to the US having larger and more transparent capital markets. It’s simply easier to do business in dollars due to the network effect that most of the world still uses dollars for foreign trades. We may see something more like regional reserves, with countries choosing economic spheres in the upcoming decoupling of the United States’ and Chinese economies (similar to Western and Soviet bloc spheres of influence during the Cold War). Alternatively, a shooting war between the two countries could determine which currency the world backs. Or a final scenario: the collapse of the American empire or a catastrophic monetary collapse, such as hyperinflation, would tank the entire world economy and global finance – China included, as the US is China’s largest customer – and it’s uncertain which currency might take over as the world reserve after this. I think the most likely scenario is that we’ll be moving back to gold or a new hard, non-fiat currency until the dust settles.