{"id":56757,"date":"2021-02-13T09:25:06","date_gmt":"2021-02-13T14:25:06","guid":{"rendered":"https:\/\/olduvai.ca\/?p=56757"},"modified":"2021-02-13T09:25:06","modified_gmt":"2021-02-13T14:25:06","slug":"the-foundation-for-potential-price-hyperinflation-is-being-laid","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=56757","title":{"rendered":"The Foundation for Potential Price Hyperinflation is Being Laid"},"content":{"rendered":"
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The Foundation for Potential Price Hyperinflation is Being Laid<\/a><\/h3>\n<\/div>\n<\/div>\n<\/section>\n
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\"The<\/div>\n

The Federal Reserve sure seems to have a tough time finding and reporting signs of rising inflation \u2014 especially when it\u2019s\u00a0hidden in other sectors<\/a>\u00a0like a lack of demand for energy.<\/p>\n

A recent example of the Fed\u2019s \u201cinflation blindness\u201d comes from a speech Chairman Jerome Powell gave to the Economic Club of New York. According to a MarketWatch\u00a0piece<\/a>\u00a0that reported on that speech:<\/p>\n

Powell said\u00a0he doesn\u2019t expect \u201ca large nor sustained\u201d increase in inflation right now.<\/strong>\u00a0Price rises from the \u201cburst of spending\u201d as the economy reopens are not likely to be sustained.<\/p><\/blockquote>\n

It\u2019s odd that Powell would say he doesn\u2019t expect a sustained increase in inflation, because\u00a0food price inflation<\/a>\u00a0has\u00a0consistently run 3.5 to 4.5 percent<\/strong>\u00a0since<\/a>\u00a0April last year. That sure seems like a sustained increase in food prices.<\/p>\n

What Powell seems to have \u201cforgotten\u201d is that some of the overall inflation includes negative energy price inflation (as low as\u00a0negative 9 percent<\/strong>\u00a0at one point). But now that the demand for fuel is returning, the\u00a0official<\/a>\u00a0gasoline index rose 7.4 percent in January.<\/p>\n

It will be much more challenging for Powell to keep downplaying the risk of\u00a0hyperinflation<\/a>\u00a0once energy price inflation rises back to \u201cpre-pandemic\u201d levels.<\/p>\n

In fact, Robert Wenzel\u00a0thinks<\/a>\u00a0the main inflation event is \u201cjust about to hit.\u201d If it does, and inflation does rise past Powell\u2019s two percent target, it isn\u2019t likely to stop there. Jim Rickards\u00a0thinks<\/a>\u00a0that\u2019s when hyperinflation can gain momentum:<\/p>\n

If inflation does hit 3%, it is more likely to go to 6% or higher, rather than back down to 2%. The process will feed on itself and be difficult to stop. Sadly, there are no\u00a0Volckers<\/a> or Reagans on the horizon today. There are only weak political leaders and misguided central bankers.<\/p><\/blockquote>\n

\u2026click on the above link to read the rest of the article\u2026<\/p>\n

 <\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

The Foundation for Potential Price Hyperinflation is Being Laid The Federal Reserve sure seems to have a tough time finding and reporting signs of rising inflation \u2014 especially when it\u2019s\u00a0hidden in other sectors\u00a0like a lack of demand for energy. A recent example of the Fed\u2019s \u201cinflation blindness\u201d comes from a speech Chairman Jerome Powell gave […]<\/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":[18769,124,7783,303,413,426,13599,16888,538,13351,3650,4254],"class_list":["post-56757","post","type-post","status-publish","format-standard","hentry","category-economics","tag-birch-gold-group","tag-central-banks","tag-credit-expansion","tag-fed","tag-hyperinflation","tag-inflation","tag-james-rickards","tag-jerome-powell","tag-money-printing","tag-price-inflation","tag-us-federal-reserve","tag-wolf-richter"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/56757","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=56757"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/56757\/revisions"}],"predecessor-version":[{"id":56761,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/56757\/revisions\/56761"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=56757"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=56757"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=56757"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}