Who actually believes inflation is at 8.6%?
There’s too much talk about inflation and not enough talk about how we got here.
- January 2021: 1.4%
- March 2021: 2.6%
- $1.9 Trillion COVID Relief Package
- July 2021: 5.4%
- Democrats propose $3.9 Trillion budget plan
- November 2021: 6.8%
- President Biden signs $1 Trillion infrastructure package
- March 2022: 7.9%
- April 2022: 8.3%
- May 2022: 8.6%
Inflation isn’t going away anytime soon. The financial incompetency we’ve seen throughout the COVID-19 pandemic will yield years of repercussions for what ultimately amounted to a bad flu. You can’t print trillions of dollars out of thin air, shut down businesses and production, and think a simple market correction is all we’re going to experience.
The US Dollar used to be backed by gold, but today fiat money is created by the Federal Reserve. Up until March 2020, banks were required to hold 10% of their total money in reserve. But shortly after Governors began locking down their states for COVID, the Feds changed their policy so that banks wouldn’t need to hold *any* money in reserve – but that hardly made the news.
With interest rates so low throughout the pandemic, zero dollars in bank reserves, and the Federal Government printing money haphazardly, it’s safe to say we’ve gone from correction to recession and bordering on the edge of an economic depression in a little less than 18 months.
The next 6 to 18 months look bleak at best. It’s going to be a bumpy road ahead.
If the Fed increases interest rates to curb inflation, they risk throwing the US economy into a deep recession. If the Fed doesn’t increase interest rates, they risk hyperinflation and possible stagnation if wages don’t keep up with price increases. Either way, America’s working class is getting shafted.