{"id":24109,"date":"2017-06-05T20:22:04","date_gmt":"2017-06-06T01:22:04","guid":{"rendered":"http:\/\/olduvai.ca\/?p=24109"},"modified":"2017-06-05T20:22:04","modified_gmt":"2017-06-06T01:22:04","slug":"the-path-to-inflation-helicopter-money","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=24109","title":{"rendered":"The Path to Inflation: “Helicopter Money”"},"content":{"rendered":"

The Path to Inflation: “Helicopter Money”<\/a><\/h3>\n
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The general view in inflation is dead, essentially forever. Maybe. Maybe not.<\/i><\/div>\n
We all know real-world inflation for big-ticket expenses is far above the official rate of around 2% annually.<\/b><\/div>\n
<\/div>\n
Yet conventional economists are virtually unanimous that deflation is the danger and inflation is a “good thing” we need to spur so servicing existing debt becomes easier for debtors.<\/div>\n
Due to the deflationary pressures of technology and stagnant wages for the bottom 90%, the consensus sees low inflation as far as the eye can see.<\/div>\n
When the consensus is near-100% on one side of the boat, we can safely bet Reality will not conform to expectations.<\/b>\u00a0This leads to a question: what could cause official near-zero inflation to surprise the consensus and leap higher?<\/div>\n
One possible answer is “helicopter money”:<\/b>\u00a0money created by central banks that is distributed directly to households via tax rebates, debt forgiveness, or Universal Basic Income (UBI).<\/div>\n
For the past 17 years, central banks have funneled credit and liquidity into the banks at the top of the wealth-power pyramid. Very little of this new “wealth” has trickled down to the bottom 90% of households in the real economy who have seen their earnings stagnate and their costs rise.<\/div>\n
Now that debt and essentials are absorbing much of the bottom 90%’s earnings, there’s little fuel left for additional debt-based consumption. This is why we see auto sales plummeting.<\/div>\n
The only way the central banks\/states can fuel more debt and spending is to drop “helicopter money” directly into the consumers’ checking accounts.<\/div>\n
Once they do this, the “new money” goes directly into the real economy.<\/b>\u00a0This is quite different than the past 17 years of monetary stimulus that went mostly into assets owned by the wealthy.<\/div>\n
There’s another driver of inflation: shortages of essential commodities.<\/b>\u00a0I define inflation very simply: a loss of purchasing power, which means we are paying more money for the exact same good or service.<\/div>\n
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…click on the above link to read the rest of the article…<\/p>\n<\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

The Path to Inflation: “Helicopter Money” The general view in inflation is dead, essentially forever. Maybe. Maybe not. We all know real-world inflation for big-ticket expenses is far above the official rate of around 2% annually. Yet conventional economists are virtually unanimous that deflation is the danger and inflation is a “good thing” we need […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[127,151,15374,5981,426,4924],"class_list":["post-24109","post","type-post","status-publish","format-standard","hentry","category-economics","tag-charles-hugh-smith","tag-commodities","tag-consumer-price-inflation","tag-helicopter-money","tag-inflation","tag-oftwominds"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/24109","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=24109"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/24109\/revisions"}],"predecessor-version":[{"id":24110,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/24109\/revisions\/24110"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=24109"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=24109"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=24109"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}