Anyone catch the speech that whoever is actually running things gave Biden to say? I swear that this political climate is starting to look like the opening chapters of ‘Atlas Shrugged’. I suspect it’ll start drifting towards the first 3/4ths of “The Mandibles” (recommended) before we’re through. Trillions of dollars. Just for fun, a dollar bill is about 6.14″ long. If you lined a trillion dollar bills up end to end, the line would be a bit under 97,000,000 miles…thats about 3900 times around the earth. Here’s better perspective. Or, put another way, if you literally took every single bit of US currency around the world and put it into .gov’s hands, that’d be about $1.2 trillion.
So, what you’ve got is a guy who wants to spend more cash than actually exists. He could literally take all the currency that exists and it would still not pay for the things he wants.
Kinda hard to wrap your head around that, isn’t it?
Fortunately, as I understand it, the money (such as it is) is simply created with a push of the button. No need to pull the cash out of every person’s wallet. Yet.
Here’s the part I don’t understand: When Robert Mugabe prints physical money to fund his government, hyperinflation results. When the US .gov does it electronically instead of physically, we get….minimal inflation? Something doesn’t connect for me there.
The old expression is “All politics is local”. You may not understand, care, or feel that the consequences of this sort of economic behaviour will affect you. National debt? Thats a national problem. But when your paycheck gets smaller as taxes go up, as your purchasing power goes down, as economic growth slows and jobs fade, as .gov handouts pile up and people no longer want to work…then you’ll notice. And then it’ll be too late to prepare.
I’ve no crystal ball. What I do have, though, is a unique perspective and outlook. Sometimes it works for me, sometimes it doesn’t. But I’m never sorry when it pushes me towards caution, since I’ve regretted too little caution far more often than I’ve regretted too much caution. And now, it’s pushing me towards caution. So be it. If I’m right, I fare better than most. If I’m wrong, all I’ve done is build up a diverse store of assets and experienced some opportunity cost.
Will we be hauling around money in wheelbarrows eventually? Nah. I just can’t see that happening. But, here’s an interesting blog post about if that whole ‘wheelbarrows of money’ thing was actually real.
“Something doesn’t connect for me there.” – I think part of the reason why the US doesn’t have hyper-inflation, yet, is because there’s still a market for the US debt that’s used to “back up” the printed money (“full faith and credit of the federal government”). Even with the interest on T-bills being so low, they’re still perceived as a safe harbor by most of the rest of the world. The Chinese and the Japanese have a huge amount of our T-bills, and while they might originally been an “investment” in a safe currency for those countries, now they’re as fu*#ed holding them as we are having to pay even the very low interest on our debt.
The market that has been buying it up is…the Fed. The Fed (a privately owned corporation) LOANS every dollar to the Treasury which prints it. The interest is never printed, so it can never be paid back.
The reason that we don’t have hyperinflation, yet, is because we still hold the world’s reserve currency. We export our inflation to the rest of the world, and have been doing it since 1971 when Nixon closed the gold window.
The minute the dollar is dethroned from the world reserve currency, all of the dollars we have exported around the world will come rushing home. That’s when you will need the wheelbarrow.
Doc is right. With the Fed buying our debt they’ve essentially created about 8 trillion dollars in the last 2 years.
As soon as the world stops using the dollar in international trade we go from zero to Zimbabwie in an instant. We are coasting along on some sort of social momentum and nothing more.
Someone said “When l owe you 10000 dollars I have a problem. When I owe you 10 Billion dollars YOU have a problem “.
Hemingway said it best “How did I go broke? Slowly at first then ALL at Once “.
The Butchers Bill WILL come due.
Long out of debt, Long storage foods
Biden is quite simply delusionally insane.
There’s simply no way to sugarcoat that.
This s going to lead to a shooting war.
Possibly several.
Oh, for a summary of his address, I’ve created a handy guide:
https://raconteurreport.blogspot.com/2021/04/tldr-emperor-gropey-dopeys-address.html
He’s not delusional. He’s a Marxist and is intentionally looking to destroy the country.
No, he is delusional but his handlers aren’t.
It’s partly as Joe said, the US dollar is the world reserve currency, hell, there are at least seven independent countries who’s official currency is the US dollar. Basically that makes the inflation numbers spread out over most of the world.
The second thing hiding the inflation numbers is the stock market, there are trillions of dollars there that are just nonsense, most companies P/E ratios are totally off the chart.
On the plus side, most existing US currency is just ones and zeros in computers so when there is a market correction (aka crash that makes 1929 look like a small dip) they will all disappear which is better for recovery then having to destroy physical currency or make a whole new one.
As happened in numerous countries throughout Africa, and more recently Venezuela, merka will soon fall victim to, too much paper, too little value. Where the value of the dollar is practically zip. And far as I know we’d have more luck inventing bacon flavored strawberries that producing money trees…. It’s not rocket science!
Hang onto your Silver/Gold/precious metals and tangibles, and keep it all in your pocket, or at least where you can access it without electronic devices/interweb/other storage places reliant upon others for you your access.
When it happens, the crash is going to to give you months of warning, then someone will say the wrong thing or make the wrong policy and it will be over, all overnight….
“When the US .gov does it electronically instead of physically, we get….minimal inflation? Something doesn’t connect for me there.”
We can get away with this for now because, we are the world reserve currency. That’s why China and Russia have been pushing to remove the dollar as the means of pricing oil among other things. China and Russia have also increase trade using Euros over dollars. It’s just a matter of time, before if falls apart. Most people do not remember before WWII, the British pound was the world reserve currency!!! So, we have only been in this role for about 80 years.
The BRICS agreement has partner countries using gold for trade among membetnations.
Brazil
Russia
India
China
South Africa
I expect more countries to enter this agreement or create similar partnerships.
Historically Collapses are telegraphed by the Friday BANK HOLIDAY, as long as the Powers that be NEED the holiday. Credit FREEZE and then a Re-evaluation of the Money NOT to Your Benefit.
The Powers that Be KNOW before you and I hear. They cash out so to speak and the tax donkeys (or in a Poker Game the suckers) pay the piper.
While I have gold and silver I STRONGLY suggest 5 gallon pails filled with dry beans, white rice, multivitamins, vitamin C, seasonings, SALT, and in a separate container well away from stuff plain pool shock WITH the directions to make bleach printed out. That stuff is corrosive and flammable.
I suspect I can trade a at current Walmart prices a 55.00 pail of the above (YES I did DO this including the pail and lid last week) for an ounce of gold shortly after the grocery stores are smoldering ruins.
WHY would the grocery stores be smoldering ruins you ask? Have you LOOKED Around at what Burn Loot Murder has been doing over “Police Brutality” lately? NOW REMEMBER who folks ACTED OUT when the EBT cards failed a year or two ago for a few days.
Hungry people are ANGRY People. 3 meals from Anarchy isn’t just a slogan.
Pool shock is NOT flammable – it is an oxidizer. Do not store it near flammable materials as it can cause ignition. Do not store it near metals, as it will rust steel like you would not believe. It will also corrode aluminum and other light metals.
This is an interesting podcast episode about government spending, and how the philosophy on interest rates and spending has shifted over the last 30 years or so.
https://www.npr.org/2021/02/23/970595276/bond-voyage
The US Dollar is like fairy dust in Peter Pan. As long as you believe in it, it continues to work.
Part of the lack of inflation is how they report it. If something gets to expensive they remove it from the CPI basket and substitute it with something else.
The next part is a little bit more complicated. They can print all the money that they’d like but if it doesnt circulate there won’t be any inflation. It’s when folks leave there homes and blow the stimmy checks on TVs, computers, laptops, etc. that prices go up. Somethings have started trickling up but it’s one of those things that starts slower at first and then happens much more faster as the situation develops, because monetary velocity is driven by psychological factors. As people see inflation they begin to anticipate it and start buying more as a hedge. That exasterbates the problem and inflation goes up even more….
Seen the price of new trucks ?
What’s the mean price of a starter home ?
Stay Spicy…
Ted Cruz on Newsmax this morning said “please don’t tell the Democrats what comes after trillion.” Ain’t that the truth! On another note, the nerve of Joke Biden saying, again, no amendment is absolute. Ummmm, yes they are. So, using his thinking, that means slavery is coming back and women won’t be able to vote any longer. All 27 amendments are now in danger. Add to that that We the People aren’t since we don’t work in the White House or Capital Hill. The arrogance and utter stupidity runs so deep in the Dems.
Check the 14% inflation in papertowels at costco