The Federal Reserve — headed now by Jay Powell — released the minutes from the last meeting in March. The Fed is feeling that inflation, which has been under 2% annually for many years, is about to grow.

There is little evidence of inflation, but the Fed says that since Trump’s tax cuts gave thousands of workers a bonus and the raising of minimum wage, inflation will come and the Fed should continue raising rates.

This premise could not be more wrong. Americans who received any benefits from the tax bonus or rising minimum wage used that cash to pay down their credit card balances. There was little velocity to the cash that was injected into the economy by these two measures.

Most Americans are so far behind on their credit card balances they used the windfall to pay down their credit cards and was not used to obtain more credit. The additional cash was used to cut up the highest interest rate card.

In the fourth quarter of 2017, 7.6 percent of total credit card balances were seriously delinquent, more than 90 days, according to a report by the NY Federal Reserve Bank.

As of December 31, 4.7% of outstanding debt was in

some stage of delinquency. Of the $619 billion of debt that is delinquent, $406 billion is seriously delinquent (at least 90 days late or

“severely derogatory”). The flow into 90+ days delinquency for credit card balances has been increasing notably from the last y

ear

and the flow into 90+ days delinquency for auto loan balances has been slowly increasing since 2012.