5 Principles Of Stagflation, by Jeffrey Tucker

Anyone who lived the 1970s knows what stagflation is. It’s back. From Jeffrey Tucker at The Epoch Times via zerohedge.com:

Stagflation is the combination of slow or falling economic output plus high inflation. For nearly two years, we’ve been stuck in this pattern and it still feels confusing. Prices for many items such as cars and homes have whipsawed around in strange ways, up one month and down the next, only to repeat the pattern.

As inflation started, many people believed the official line that this was “transitory,” a word that people heard as “temporary.” If you think about it, the word transitory is meaningless as a predictive tool. It means moving from one thing to another thing without saying what the thing is. It turns out that transitory meant a transition to a permanently and dramatically weaker dollar from 2019 prices.

People such as Treasury Secretary Janet Yellen likely knew this. They just wanted to calm people’s fears and keep them believing false things until the midterm elections. Contrast that to how this crowd handled the virus of 2020: They promoted public panic in every possible way as a means of terrifying the population into compliance and ultimately turning against the president. Indeed, that was the goal all along.

In any case, it should be obvious by now that inflation is the new normal. We’ll never see 2019 prices across the board again, simply because for that to happen, the Federal Reserve would have to tolerate a deflation of 12 to 15 percent. If that does happen—and it’s highly unlikely—it won’t be because the Fed wants it that way. It would suggest that the Fed had lost control completely.

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