Stupidity has consequences. Debase your currency and the dollar price of a barrel rises towards $100, which gives sellers of oil, like Russia, the upper hand. From MN Gordon at economicprism.com:
The ruling elite loves spending money. But only when it’s your money; not theirs.
Of all modern economic dogmas, the one held dearest by the ruling elite is the belief government can spend the economy to growth using debt. Certainly, government spending redirects economic growth to government preferred industries.
But government stimulus doesn’t grow the economy. How could it? Aside from stacks of legislation, levies, and fees, government doesn’t produce a doggone thing.
To the contrary, government usurps capital and uses it in ways businesses and individuals otherwise wouldn’t. Specifically, the government uses its heavy hand to distribute capital to places that, absent coercion, people wouldn’t pay for. These generally equate to value subtracting endeavors – like bullet trains in California’s Central Valley at a price tag of $105 billion and growing.
The great government giveaway that was executed by the Federal Reserve and the U.S. Treasury to somehow counteract the economic consequences of mandatory lockdown orders has come with its own consequences. Namely, the printing press financed stimulus has propelled consumer price inflation to a 40 year high.
The mechanics of the giveaways were rather crude. If you recall, starting in March 2020, the Treasury issued $3 trillion of new debt. This new debt was bought by the Federal Reserve using $3 trillion of new reserves that were created from thin air. This printing press money was then sent by the Treasury via stimmy checks to people and businesses.
The process was then repeated to the tune of another $2 trillion in printing press money. The U.S. national debt rose over 30 percent in less than 24 months and now tops $30 trillion. Should it be a shocker that inflation’s raging out of control?
STRAIGHT LINE LOGIC 