{"id":61137,"date":"2021-12-28T06:44:33","date_gmt":"2021-12-28T11:44:33","guid":{"rendered":"https:\/\/olduvai.ca\/?p=61137"},"modified":"2021-12-28T06:44:33","modified_gmt":"2021-12-28T11:44:33","slug":"is-the-crack-up-boom-here","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=61137","title":{"rendered":"Is the Crack-up Boom Here?"},"content":{"rendered":"

Is the Crack-up Boom Here?<\/a><\/h3>\n

Bloomberg News recently solicited advice from Argentinians who lived through that country\u2019s high inflation on how Americans should cope with rising inflation. The Argentinians suggested Americans spend their paychecks as fast as possible to avoid future price increases. They also suggested taking out loans that can be paid back later in devalued currency.<\/p>\n

These strategies may make sense for individuals. However, encouraging debt and discouraging savings is disastrous for the country. Relying on debt and spending one\u2019s paycheck immediately encourages people to seek instant gratification instead of planning for the future. This depletes both economic and moral capital.<\/p>\n

November\u2019s 9.6 percent increase in the producer price index, combined with the consumer price index\u2019s increase to levels not seen since the early 1980s, shows why fears of inflation have become the public\u2019s number one concern. Even the Federal Reserve has acknowledged that inflation is not just \u201ctransitory.\u201d<\/p>\n

The Fed recently announced it is accelerating the timetable to reduce its monthly purchases of Treasury and mortgage-backed securities. The Fed also announced it is planning three interest rate increases next year. However, the Fed plans to increase rates by no more than one percent. So even if the Fed does follow through on its promise to hike rates, it will do little if anything to combat rising prices. If the Fed allowed interest rates to rise to anything approaching market levels, it would make the federal government\u2019s debt servicing costs unsustainable. This puts tremendous pressure on the Fed to maintain low rates.<\/p>\n

The biggest victims of the Federal Reserve\u2019s erosion of the dollar are lower- and middle-class Americans whose paychecks do not keep pace with the Fed-caused price increases. Yet many progressives still cling to the fallacy that average workers somehow benefit from continued dollar devaluation.<\/p>\n

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

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Is the Crack-up Boom Here? Bloomberg News recently solicited advice from Argentinians who lived through that country\u2019s high inflation on how Americans should cope with rising inflation. The Argentinians suggested Americans spend their paychecks as fast as possible to avoid future price increases. They also suggested taking out loans that can be paid back later […]<\/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":[122,7822,195,303,380,692,827,3650],"class_list":["post-61137","post","type-post","status-publish","format-standard","hentry","category-economics","tag-central-bank","tag-crack-up-boom","tag-debt","tag-fed","tag-government-debt","tag-ron-paul","tag-united-states","tag-us-federal-reserve"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/61137","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=61137"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/61137\/revisions"}],"predecessor-version":[{"id":61138,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/61137\/revisions\/61138"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=61137"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=61137"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=61137"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}