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April 13, 2011 More Price Ramps Ahead
Over the last few months, the Federal Reserve has purchased billions of Treasuries in an attempt to lower borrowing rates to alleviate unemployment and avert deflation. That was the plan.
Not all is well with the plan or its execution. As data points line up, one may even be excused for asking out loud if the Federal Reserve is actively engaged in destroying the middle class here and everywhere else on our planet. From what we see, they are driving our fiscal clown car off a cliff. The recently released BLS import and export report simply confirms what many of already knew was happening or was going to happen. Prices everywhere on nearly everything of substance are going up dramatically. In terms of worldwide economic significance, introducing major price ramps into the supply chain of basic goods and services during an economic slowdown is a very bad idea but is also a sign of the times. The 04-12-11 BLS News release: U.S. IMPORT AND EXPORT PRICE INDEXES -MARCH 2011 is chock full of evidence showing how an eroding dollar and rocketing commodities are affecting everything we purchase and import and what we sell overseas to our trading partners. These increases in the basic inputs into the world wide economy are truly staggering. I have provided an excerpt below:
Our addiction to spending is causing problems everywhere, not just here in the United States. Let me be quite clear: Folks, these are truly huge increases. Nothing good can come from this and it is a safe bet that more price increases or margin collapse is already baked into the cake that is coming our way. Update from Thomas Lifson: John Melloy of Fast Money points out that using the old, pre-1980 measure of inflation, we already have inflation over 10%:
Over the last few months, the Federal Reserve has purchased billions of Treasuries in an attempt to lower borrowing rates to alleviate unemployment and avert deflation. That was the plan. Not all is well with the plan or its execution. As data points line up, one may even be excused for asking out loud if the Federal Reserve is actively engaged in destroying the middle class here and everywhere else on our planet. From what we see, they are driving our fiscal clown car off a cliff. The recently released BLS import and export report simply confirms what many of already knew was happening or was going to happen. Prices everywhere on nearly everything of substance are going up dramatically. In terms of worldwide economic significance, introducing major price ramps into the supply chain of basic goods and services during an economic slowdown is a very bad idea but is also a sign of the times. The 04-12-11 BLS News release: U.S. IMPORT AND EXPORT PRICE INDEXES -MARCH 2011 is chock full of evidence showing how an eroding dollar and rocketing commodities are effecting everything we purchase and import and what we sell overseas to our trading partners. These increases in the basic inputs into the world wide economy are truly staggering. I have provided an excerpt below:
Our addiction to spending is causing problems everywhere, not just here in the United States. Let me be quite clear: Folks, these are truly huge increases. Nothing good can come from this and it is a safe bet that more price increases or margin collapse is already baked into the cake that is coming our way. Over the last few months, the Federal Reserve has purchased billions of Treasuries in an attempt to lower borrowing rates to alleviate unemployment and avert deflation. That was the plan. Not all is well with the plan or its execution. As data points line up, one may even be excused for asking out loud if the Federal Reserve is actively engaged in destroying the middle class here and everywhere else on our planet. From what we see, they are driving our fiscal clown car off a cliff. The recently released BLS import and export report simply confirms what many of already knew was happening or was going to happen. Prices everywhere on nearly everything of substance are going up dramatically. In terms of worldwide economic significance, introducing major price ramps into the supply chain of basic goods and services during an economic slowdown is a very bad idea but is also a sign of the times. The 04-12-11 BLS News release: U.S. IMPORT AND EXPORT PRICE INDEXES -MARCH 2011 is chock full of evidence showing how an eroding dollar and rocketing commodities are affecting everything we purchase and import and what we sell overseas to our trading partners. These increases in the basic inputs into the world wide economy are truly staggering. I have provided an excerpt below:
Our addiction to spending is causing problems everywhere, not just here in the United States. Let me be quite clear: Folks, these are truly huge increases. Nothing good can come from this and it is a safe bet that more price increases or margin collapse is already baked into the cake that is coming our way. Update from Thomas Lifson: John Melloy of Fast Money points out that using the old, pre-1980 measure of inflation, we already have inflation over 10%:
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