The U.S. economy is strained to the point of breaking Americans’ budgets, and this week’s releases of consumer and producer inflation data showed that the pain being felt by American families and U.S. companies isn’t going to ease up soon.
As a result of steadily rising inflation that kicked off just after President Biden took office and has so far reached and stayed in 40-year high territory — including repeated all-time records set for fuel prices — Americans’ budgets are being stretched to the breaking point and then some.
That’s because, even as wage growth is trending higher — around five percent over last year — the eight-plus percent consumer inflation means Americans’ real wages are actually three percent lower than twelve months ago.
Mostly we get lies, spin and obfuscation from central bankers, politicians and bureaucrats. But every once in a while, one of these people accidentally wanders into the truth.
IMF Director Kristalina Georgieva did just that during a recent panel discussion hosted by CNBC. She conceded that central banks globally “printed too much money and didn’t think of unintended consequences.”
I think we are not paying sufficient attention to the law of unintended consequences. We take decisions with an objective in mind and rarely think through what may happen that is not our objective. And then we wrestle with the impact of it.
“Take any decision that is a massive decision, like the decision that we need to spend to support the economy. At that time, we did recognize that maybe too much money in circulation and too few goods, but didn’t really quite think through the consequence in a way that upfront would have informed better what we do.”
How this economic brain trust missed failed to consider that injecting trillions into the economy would cause prices to rise is a bit of a head-scratcher. This is economics 101. Expanding the money supply pushes prices higher than they otherwise would be. I knew this would happen. Peter Schiff knew this would happen. Heck, you probably knew this would happen. But the people charged with running the global economy didn’t?
These people are either wildly incompetent, or they are lying to you.
The lockdowns damaged the economy in ways people are only now beginning to comprehend, with hundred of thousands of small businesses lost across the country. Not only that, but the establishment responded to the economic implosion they created by printing over $6 trillion in new money through the Fed in 2020 alone. This helicopter money, or beta test for UBI (Universal Basic Income), has expedited a stagflationary disaster and helped to push prices on necessities to 40-year highs (the official number).
The media claims it is “covid that is causing the crash,” but this is a lie. It was the RESPONSE to covid that is causing the crash. The virus was incidental to the economic sabotage initiated by governments and central banks. As we saw in conservative red states that defied the lockdowns and the vax mandates, economic activity thrived while leftist blue states suffered. And what did these blue states get in return for their economic sacrifices? Nothing. Covid infections continued to rage in blue states, and deaths often outpaced red states with similar-sized populations.
In other words, the lockdowns, the mask mandates and the attempts force vaccinations through medical tyranny saved ZERO lives and possibly made things worse. This is the legacy of government micro-management (And yes, let’s not forget that Trump went along with these lockdowns in the beginning of the pandemic also. Biden is just the dirt-bag that continued the measures despite the massive amount of evidence that they don’t work).
While the covid event illustrates my point in a big way, there are a lot of deeply rooted problems that government intervention has caused that add up to one big fiscal calamity. Many of these threats require a basic but sweeping return to fundamentals that government elites will rarely address and will try to stop at all costs. Here are just a few examples…
A leading manufacturer of hydrogen and nitrogen products was informed Union Pacific rail lines were reducing and limiting shipments of fertilizer during the planting season this year.
Who made this decision?
CF Industries reported:
CF Industries Holdings, Inc. (NYSE: CF), a leading global manufacturer of hydrogen and nitrogen products, today informed customers it serves by Union Pacific rail lines that railroad-mandated shipping reductions would result in nitrogen fertilizer shipment delays during the spring application season and that it would be unable to accept new rail sales involving Union Pacific for the foreseeable future. The Company understands that it is one of only 30 companies to face these restrictions.
CF Industries ships to customers via Union Pacific rail lines primarily from its Donaldsonville Complex in Louisiana and its Port Neal Complex in Iowa. The rail lines serve key agricultural areas such as Iowa, Illinois, Kansas, Nebraska, Texas and California. Products that will be affected include nitrogen fertilizers such as urea and urea ammonium nitrate (UAN) as well as diesel exhaust fluid (DEF), an emissions control product required for diesel trucks. CF Industries is the largest producer of urea, UAN and DEF in North America, and its Donaldsonville Complex is the largest single production facility for the products in North America.
“The timing of this action by Union Pacific could not come at a worse time for farmers,” said Tony Will, president and chief executive officer, CF Industries Holdings, Inc. “Not only will fertilizer be delayed by these shipping restrictions, but additional fertilizer needed to complete spring applications may be unable to reach farmers at all. By placing this arbitrary restriction on just a handful of shippers, Union Pacific is jeopardizing farmers’ harvests and increasing the cost of food for consumers.”
If you only get your news from the mainstream media, you would be tempted to believe that global conditions are relatively stable right now.
Yes, there is a war between Russia and Ukraine, but the mainstream media is assuring us that Ukraine is winning that war.
Other than that, the mainstream media seems to think that everything is just fine.
Of course the truth is that our planet is facing a whole host of extremely challenging problems at the moment. The UN has warned that we are entering the worst global food crisis since World War II, inflation has started to spiral out of control all over the world, the war in Ukraine is making our supply chain nightmares even worse and an absolutely horrifying bird flu plague is killing millions upon millions of chickens and turkeys.
But if you flip on one of the corporate news channels tonight, they will be focusing on other things.
And you probably won’t even hear them talk about the food riots that have suddenly begun erupting around the world at all.
For example, a “curfew” has just been imposed on the capital of Peru after a series of extremely passionate protests that were sparked by rapidly rising fuel and food prices…
Peruvian President Pedro Castillo announced a curfew for Tuesday in the capital Lima and neighboring port city Callao, after demonstrations across the country over fuel prices caused roadblocks and “acts of violence”.
Protests had erupted across Peru in recent days due to a hike in fuel prices and tolls, during a time of rising food prices.
Is this the first time that you have heard about this?
For many of you it will be, and that is because the mainstream media in the U.S. is largely ignoring this.
In Sri Lanka, severe shortages of “food, medicine and fuel” have caused a full-blown economic collapse and tremendous chaos in the streets…
In Sri Lanka, where an economic crisis is growing, more than 40 lawmakers walked out of the ruling coalition today. That leaves the government of President Gotabaya Rajapaksa in the minority in Parliament. There have been new calls today for both the president and prime minister to step down after the entire Cabinet resigned on Sunday. Shortages of food, medicine and fuel have sparked countrywide protests, and security forces have fired tear gas and water cannons at protesters marching on the president’s home.
Most of you have probably not heard about that either, and that is because our largest news outlets are being really quiet about it.
But USA Today wants to make sure that you know about a new promotion that McDonald’s is running: “McDonald’s brings back Spicy Chicken McNuggets to select restaurants for a limited time”.
More than ever before, our perception of the world around us is shaped by the corporate elite. Americans get more than 90 percent of the “television news” that they consume from just five giant media corporations, and so that gives those corporations an incredible amount of influence over how our society views reality.
For example, far more Americans are talking about “the slap” at the Academy Awards than about the fact that North Korea just threatened South Korea with nuclear war…
Did you know the economy was booming? This may come as a shock to anyone out there who a) is alive or
b) has to buy things, but it’s definitely true.
Mehdi Hasan did a segment on his show.
NBC report “President Biden’s approval rating has fallen to lowest level of his presidency despite booming economy”, and Hasan just doesn’t understand why people would be “unhappy with the way Biden is handling the economy” when wages are growing and they’ve added a “record 6.4 million job” in 2021.
Now, OK, that reported 4.5% wage growth is lagging way behind inflation, meaning in real terms people are being paid less.
Yes, alright, the “new jobs” were really just (some) of the people who lost their jobs during lockdown being rehired.
And fine, the reason spending is increasing could be that everything costs more.
But seriously, we’re fine, it’s booming.
Now, some booming economy deniers, Russian bots or anti-vaxxers will doubtless point to all the “evidence” that the US economy is not booming.
That the current price of gas is the highest ever in US history.
That the US is expected to enter a recession by the end of the year.
That house prices are increasing so fast that experts are predicting a “housing bubble”.
That the “crippling sanctions” placed on Russia seem to have “accidentally backfired” and hurt the US economy badly.
And, most of all, that moves are afoot which could see major oil trades being done in Yuan, not dollars. A change that could potentially cause the death of the petrodollar, the end of the USD as the global reserve currency, and send the US economy into a death spiral somewhere between Black Monday and Weimar Germany.
Clearly, this is all just conspiracy theories and nonsense. The economy really is booming. Oh, and in more good news the chocolate ration has increased from 30 grams a week to 20.