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Rampant Inflation In 2011? The Monetary Base Is Exploding, Commodity Prices Are Skyrocketing And The Fed Wants To Print Lots More Money

Are you ready for rampant inflation?  Well, unfortunately it looks like it might be headed our way.  The U.S. monetary base has absolutely exploded over the last couple of years, and all that money is starting to filter through into the hands of consumers.  Commodity prices are absolutely skyrocketing, and it is inevitable that those price increases will show up in our stores at some point soon.  The U.S. dollar has already been slipping substantially, and now there is every indication that the Fed is hungry to start printing even more money.  All of these things are going to cause a rise in inflation.  Not that we aren’t already seeing inflation in many sectors of the economy.  Airline fares for the holiday season are up 20 to 30 percent above last year’s rates.  Double-digit increases in health insurance premiums are being reported from coast to coast.  The price of food has been quietly sneaking up even at places like Wal-Mart.   Meanwhile the U.S. government insists that the rate of inflation is close to zero.  Anyone who actually believes the government inflation numbers is living in a fantasy world.  The U.S. government has been openly manipulating official inflation numbers for several decades now.  But we really haven’t seen anything yet.  As increasingly larger amounts of paper money are dumped into the economy, we are eventually going to see the worst inflation in American history.  The only real question is how far down the road are we going to get before it happens.  

Take a few moments and digest the chart below.  It shows just how dramatically the U.S. monetary base has been expanded recently….

Photobucket 

Up to this point this dramatic expansion of the U.S. monetary base has not caused that much inflation because U.S. government borrowing has soaked most of it up and U.S. banks have been hoarding cash and have been building up their reserves.

However, this situation will not last forever.  Eventually all this cash will make its way through the food chain and into the hands of U.S. consumers. 

But what is even more troubling is the dramatic spike in commodity prices that we have seen in 2010. 

Wheat futures have surged 63 percent since the month of June.  Wheat has recently been selling well above 7 dollars a bushel on the Chicago Board of Trade.

But wheat is far from alone.  In his recent column entitled “An Inflationary Cocktail In The Making“, Richard Benson listed many of the other commodities that have seen extraordinary price increases over the past year….

*Agricultural Raw Materials: 24%

*Industrial Inputs Index: 25%

*Metals Price Index: 26%

*Coffee: 45%

*Barley: 32%

*Oranges: 35%

*Beef: 23%

*Pork: 68%

*Salmon: 30%

*Sugar: 24%

*Wool: 20%

*Cotton: 40%

*Palm Oil: 26%

*Hides: 25%

*Rubber: 62%

*Iron Ore: 103%

Now, as those price increases enter the chain of production do you think that there is any chance that they will not cause inflation?

Do you think there is any chance at all that producers and retailers will not pass those costs on to consumers?

It is time to face facts.

Those cost increases are going to filter all the way through the system and your paycheck is soon not going to stretch nearly as far.

Inflation is coming.

Many savvy investors understand what is going on right now.  That is one reason why gold and silver are absolutely soaring at the moment.

The price of gold set another record high on Friday for the sixth straight day.   

Silver has also experienced extraordinary gains recently, and the U.S. Mint has officially raised their wholesale pricing above spot on American Silver Eagles from $1.50 to $2.00.

Meanwhile, there are even more rumblings that the Fed wants to print lots more money.  On Friday, the president of the Federal Reserve Bank of New York, William Dudley, stated that the high unemployment and the low inflation that the United States is experiencing right now are “wholly unacceptable”….

“Further action is likely to be warranted unless the economic outlook evolves in such a way that makes me more confident that we will see better outcomes for both employment and inflation before long.”

During his remarks, Dudley even mentioned what the effect of another $500 billion increase in the Fed’s balance sheet would be.

Now keep in mind, this is not just another “Joe” who is making these remarks.

This is the president of the Federal Reserve Bank of New York – the most important of all the regional Fed banks.

In recent weeks it is almost as if you can hear Fed officials salivate as they consider the prospect of flooding the economy with even more money. 

Up to this point, very little has worked to stimulate the dying U.S. economy.  The Federal Reserve and the Obama administration are getting nervous as the American people become increasingly frustrated about the economic situation.

So will flooding the economy with even more money and causing even more inflation do the trick?

Well, no, but what inflated GDP figures will do is enable Obama and the Fed to say: “Look the economy is growing again!”

But if a flood of paper money causes the value of goods and services produced in the U.S. to go up by 5 percent but the real inflation rate is 10 percent, are we better off or are we worse off?

It doesn’t take a genius to figure that one out.

So don’t get fooled by “economic growth” numbers.  Just because more money is changing hands doesn’t mean that the U.S. economy is doing better. 

In fact, many American families are going to be financially shredded by the coming inflation tsunami. 

Just think about it.

How far will your paycheck go when a half gallon of milk is 10 dollars and a loaf of bread is 5 dollars?

Already, it is incredibly difficult for the average American family of four to get by on $50,000 a year.

So how much money will we need when rampant inflation starts kicking in?

And do you think that your employers will actually give you pay raises to keep up with all of this inflation?

Not in these economic conditions.

In fact, median household incomes are declining from coast to coast all over the United States.

Earlier this year, Ben Bernanke promised Congress that the Federal Reserve would not “print money” to help the U.S. Congress finance the exploding U.S. national debt.

Did any of you believe him at the time?

Did any of you actually believe that the Federal Reserve would act responsibly and would attempt to keep the money supply and inflation under control?

The reality is that the entire Federal Reserve system is predicated on perpetual inflation and a perpetually expanding national debt. 

Whatever wealth you and your family have been able to scrape together is going to continue to be whittled away month after month after month by the hidden tax of inflation.

And unfortunately, as discussed above, inflation is about to get a whole lot worse.

So is there any room for optimism?  Is there any hope that we will not see horrible inflation in the years ahead?  Please feel free to leave a comment with your opinion below….

  • Sammyone

    What’s that vertical red line of the right of the chart? Money supply exploding right when Barack Obama and the democratic Congress got together? But doesn’t that mean they’re trying to….

    Never mind, get back to your chanting, repeat after me:
    George Bush did it, Prince of Darkness, Spawn of Evil. George Bush lied, people died, Two legs bad, four legs good. Baaahhhhh!

  • Sammyone

    Wake up, people! Elections in November. A pox on both their houses. Don’t give one party all the power. They will destroy us. Give the Congress to Brand X. If Brand Y runs everything we are finished, quick!

  • Matt

    Yeah, when money is printed, or quantitative easing, whoever gets the money first before inflation kicks in is the winner.

    The end game is the destruction of the dollar so a regional and eventual a world currency can rein.

    Accept Jesus and stay close to God. All this economic uncertainty will seem small by comparison anyway.

  • tyler

    I haven’t noticed my coffee price going up what so ever. My food bill is the same as it was six months ago. I’m not saying it won’t go up but I’ve been hearing about hyper inflation for years and I’ll just have to take the I’ll believe it when I see it approach.

  • Jackson

    Inflation is pretty worriesome, i wonder how it will really play out. I think peter schiff provides a pretty interesting perspective in regards to inflation. If inflation will really be that bad, i can’t imagine that worlds governments will let rapid inflation occur to the united states because it will affect all the countries we trade with and hit their economy too. Hopefully all the governments will just play the ” manipulation game together ” so we won’t experience inflation.

  • http://www.planorperish.com/ Gutter Economist

    Gold and silver are popular hedges against the devaluation of paper money. A practical and realistic application would be as follows:

    *** 5% of your liquid assets in a Goldmoney Account for the long term. Go to http://www.goldmoney.com to open an account.

    *** 10% of your liquid assets in pre 1965 United States silver coins for the long term. These coins are 90% silver. If the US dollar does collapse, Goldmoney and these silver coins will probably emerge as the new currency for some period of time. The supply of gold coins is too limited and their value would be too great to be practical. Do not invest this part of your assets in bullion, non legal coins, rare coins, or jewelry.

    *** 10% of your liquid assets in Exchange Traded Funds such as GLD (gold) or SLV (silver) for the short term. Strong commodity based currency funds like FXA (Australian Dollar) or FXC (Canadian Dollar) should also be considered. Foreign currency CDs are available at http://www.everbank.com

    A good long term sell target for gold would be when the price of gold and the Dow Jones Industrial Average are the same. For example, gold might be $3,500 per ounce and the Dow Jones Industrial Average would be 3,500. At this point, stocks would be a bargain and should be purchased aggressively after selling your gold.

  • Richard

    Bring on the inflation..i would love minimum wage to be $19.95 per hour i could pay off all my debts in a month…

    plus my landlord owns his house free and clear so my rent wont go up as much as your debt ridden broke landlord.

  • DMyers

    http://www.zerohedge.com/article/guest-post-was-stagflation-79-really-hyperinflation

    The above-noted article by Gonzalo Lira, dated Sept. 16 of this year is an interesting and informative discussion of the all-too-often forgotten 1970’s inflation. One of his conclusions is that Paul Volcker’s interest rate hikes saved us from hyperinflation, and of course this is followed by the recognition that such interest rate interventions are no longer available were hyperinflation to rear its ugly head.

    Seventies inflation (SI) has much to teach us about the inflation phenomenon. A much neglected treatment of that phenomenon is the view of it from the man on the street. Let me briefly offer some such simple observations (from a guy who worked in a mall during part of that time).

    There was a demand feature to SI, related to the glut of boomers in the critical money spending age brackets. This was especially evident in the housing market, due to a contemporaneous social development of two- earner families. I was once proposed marriage by a woman I hardly knew, for the express purpose of combining our incomes to invest in real estate (circa 1978).

    Labor costs were a factor in SI. This became very obvious. Keeping up with inflation was a new factor in labor negotiations, and the transfer of labor costs into product prices could no longer escape recognition. As a hangover from that, we had job exportation, popularly known as off-shoring. If we were able to fully appreciate its affect, job exportation may have had more to do with breaking SI than did Volcker’s interest rates, and this has become a built in feature of inflation prevention, as it continues this very day.

    There was a strong psychological feature to SI. We saw how rising prices created a self-feeding loop. “Lady, you’d better buy these boots now at fifty dollars, because they’re going to sixty five next month.” [cha-ching!] People bought now to hedge against inflation later, which drove up prices by causing a demand/supply crunch based more on expectations than on needs.

    SI brought a new obsession with the REAL value of money. Even the plumber began to decline deferring payment for his services, because even he understood that by the time he received the final payment, that money would be worth only a fraction of its present value.

    SI led to “inflation adjusted” rises in college tuitions, which continued even after inflation had supposedly subsided. It became the original rationale for such rises; that adjusted for inflation, tuition was just dirt cheap and clearly had to shoot up to at least a break even point.

    We came to recognize, first-hand, how the price of oil affected the price of everything else during SI. That loaf of bread on the shelf was delivered by a truck. When the price of delivery shot up, the price of bread shot up. This was visibly ubiquitous, as nearly all consumer goods had some delivery component dependent on oil.

    Finally, as a man on the street, I don’t believe SI ever really ended. The perceived standard of living has been maintained by ongoing active interventions which simply met inflation head on, without taming it. Technology and off-shoring have hammered down prices and increased the ease of living, so we have been blinded to inflation chewing away the economy from the margins. Needless to say, book cooking and phony government numbers have been actively employed to cover up inflation as well.

    Do with any of this what you will. Granted, no particular study or research is behind this. I was there. That’s what I saw or have seen, not so long ago. Demand and labor factors seem to have diminished in today’s environment, but other phenomena I’ve described would probably play out in an identical way in an emerging hyperinflationary situation. I’m not saying this may help us learn from history in order to avoid its repetition. I’m saying we may better understand the present by keeping in perspective what we have already seen with our own eyes.

  • http://economiccollapse Joe in GA.

    Any readers who have money to spare, I urge you go to Sharron Angle’s web site, ASAP,and give her a donation. She’s in a tight race to overthrow Hiding Harry! If Hiding Harry and Princess Nancy remain in ” power ” in Obamington, DC ( District of Corruption )we can kiss this republic goodbye!

  • Rob

    A little Biblical history (not a religious fanatic,just seems the bible has some correct historical events) The western world is the symbol of Babylonia…we are witnessing the fall of Babylon right before our eyes. There are many references of hyper inflation and buying bread….have faith, help your neighbors, and be the best person you can be. Right now, start learning skills like those just before industrialism..no gas or electricity…Think long term..a canned good isn’t as good as a fishing pole, etc. It took a while to get here, it will take a while to fix it. I have faith that Americans will survive this…we’ve always been rebels. Keep in mind, God told Abraham to have gold, silver, land, and cattle. (Gold for keeping wealth, silver for commerce, land for survival, and cattle for food. Sounds pretty basic to me). Peace and blessings to you all.

  • Stu

    Sammyone, politicians can’t and won’t save you, as they are servants of the Fed. Left vs right is just a game they use to divert people from the root of the problem, which is the central banking system and the yoke it puts on the people; namely social security and income taxes.

    “The debtor is slave to the lender”.

    Good call Matt.

  • http://www.sovereignmoney.com RobertM

    Sorry, no overall inflation for a while. We’re in a deflationary spiral. Check out Stoneleigh’s Century of Challenges for an excellent ‘big picture’ look at how all the pieces fit together (video, around 70 minutes) and sovereignmoney-dot-com for the solutions.

    Bad times are coming.

  • Dean

    Cost increases do not equal inflation because a shift in the supply/demand equation would mean that the specific commodities and related products are simply worth more. I suspect that much of the bull run in Gold and silver is related to the expectation that dollars are about to spiral down into worthlessness. Pricing in inflation can end badly for investors if everyone is wrong.

    The idea that money causes production is a fallacy. If it did then why don’t we pay a crew to build a road then once it’s complete print another round of money to pay for that road to be destroyed? Since nothing of value is being produced then the effect would be to introduce money into an environment where produced goods and services are not increasing thus the money is worth-less in spending power thus prices rise but intrinsic value remains constant.

    Let the printing presses roll… Money supply = SUM(Money+Credit). The Fed has no means to get its minted money into private hands when there is no credit and worse the population is awash in debt and bad debts at every level. The unwinding of the debts and troubled assets leaves few even capable of qualifying for credit. There is also the rarely mentioned factor that a structural shift in demographics is leading a big group out of their peak spending years toward savings (accumulation).

    Therefore the Fed will be drowning in worthless money which cannot be distributed unless Ben makes good on his helicopter promise. The whole ponzi scheme of loaning new printed money to banks which then buy treasures is being figured out. The population of rapidly rising numbers of poor do not qualify for credit. Those who do have come to despise being in debt.

    So… In my opinion a huge group of investors are poised to get wiped out as their aggressive inflation bets are actually part of the match lighting the DEFLATION fuse.

  • Jimmy

    I don’t think accepting an imaginary religious figure will have a substantive effect on inflation. But perhaps I’m being logical again….

  • El Pollo de Oro

    The U.S. dollar has been experiencing severe chest pains ever since the NWO neocon globalist devils (or as Gerald Celente calls them, “the white shoe boys”) lied the country into war in Iraq, created record deficits and turned the former USA into a Third World basketcase called The Banana Republic of America (BRA). But those severe chest pains will be turning into full cardiac arrest—and when that happens, the U.S. dollar will have about as much buying power as the Guatemalan quetzal. That’s when all hell is going to break loose. Things are bad now, but they’re going to get a whole lot worse when the U.S. dollar implodes and what’s left of the American middle class is annihilated. The BRA’s real unemployment rate in 2010, as Celente told Alex Jones, is around 21-22% (higher when you factor in underemployment). But that number is going to get much higher when the U.S. dollar’s heart monitor goes off.

    Get ready for food riots. Get ready for shantytown slums populated by what used to be the American middle class. Get ready for domestic terrorism. Get ready for violent crime rates that will rival Johannesburg (which some South Africans call “Body-Burg” because the murder rates per capita are so appallingly high). Get ready for what il nostro amico libertariano chiamato Gerald Celente (who correctly predicted the demise of the Soviet Union) correctly predicts will be The Greatest Depression, a.k.a. La Depressione Più Grande.

    The Republi-cons will not save the U.S. dollar. The Demo-craps will not save the U.S. dollar. And The Tea Party will not save the U.S. dollar. The Tea Party condemned itself to failure the minute it embraced the failed two-party system and allied itself with the same Republi-Con Party that has vilified anti-imperialist libertarian Ron Paul (the REAL party maverick) time and time again. Imperialist wars and neocon empire fantasies cost a lot of money, and the BRA’s piggy bank has long since been shattered into 1000 pieces. Yeah, the BRA is an empire alright: the Roman Empire.

    In the words of Signore Celente, the white shoe boys will “keep printing all that digital money that’s not even worth the paper it’s not printed on.” Che dio ci aiuti.

  • http://WBDM Joe in JT

    QE2 is suppose to begin in November. Once that happens look for China to dump US Treasuries. Japan holds about a trillion of our debt too, and they ain’t to happy about the extortion they recieved from the U.S. telling them to lay off the hasseling of U.S. military bases in Japan and Oki. Once the asian big boys lose confidence in the greenback and T Bills the dollar will crash and gold will be 3K per ounce. China was wicked upset at QE1 and they won’t just sit idle for QE2. There is already a currency war happening even as we speak.

    Remember about 6 months ago rice skyrocketed in price. It happened so fast too. The reason I am worried about rice is that you can store and live on rice for a long time. It’s a staple. When it becomes unafordable I get very nervous. You should too.

  • Jonathan Lam

    Gamesmith94134
    At present, we, American, suffers an implosion from disinflation rather than explosion on inflation since the Fed held on the long-term bond over the period of time. Fed focused on the single issue namely dollar that it have ignored the volume of all other currencies may vary under the channels in their states of cash flow since credit was invented. Are we preparing for another recession after the collapse of our currencies if the stimuli program miss its’ tone? No one have the answer to it; but the change of game plan or turn into chaos of some kind would take a longer path to end of our recession.
    When the value of dollar is being suppressed, other currencies ran into euro and yen, and some went for the precious metal or raw material commodity to preserve the future price of their currencies by undercutting its own currency value. Now, OCED, Japan or Brazil at the height of their currencies with limited productivity and credit; Disinflation exploded with the excessive strength of its currencies, more merger and frenzy deal will be made. While unemployment increases the cost of the subsidies. There are more with revenues is less than expenditure, budget-wise. Then, consumer goods are in jeopardy; and our American goods are harder to sell overboard even though our dollar is relatively lower than euro or yen.
    In learning the economics, we posted inflation, disinflation and deflation based on the single currency and how it was being marketed locally. As in the world economics, all currencies absorb the same doctrine of inflation and deflation; and neutral can be no change or disinflation has choked off its price in the altered value that does not reflect on the earnings or development.
    Perhaps, when we compare the economy at the strength of its currency, to the capacity to earn its claim; it could just like a glass with water half way. We put all the prices of all currencies in a glass that all of them are relatively proportion in its own right; the value of the currencies, each must be supported by it substance like employment, productivity, population and government. Then, the state as half empty currencies must balances the half full substances. Value balances price in its fair exchange and in its nature’s way as many perceive.

    No one is certain how not our economy would work under the under-priced dollar while euro and yen jumped; I think everyone will change every game plan now. As for OCED and Japan, austerity may suffocate their economy from the boost of strength in their currencies. Deflation they can bankrupt many banks and business. Their products or exports are more expensive for Americans, then, there will be more in trade deficit for America.
    Perhaps, the Fed with all its’ excellent economist, they are all good with numbers and model; but they should observe more on the physical. Nature of thing is the forever truth even under the manipulation; one goes up, it must come down. Dollar vs yen, or dollar vs yuan, manipulation only provide a substitute within either value or price. It is very physical and they do not disappeared ; they just bounce up and down. So, many should stop calculate and look into the interchange on the price and the value on the currencies. It is observation and not calculus. It is the social and global behavior that does not show on screen from the computer.
    May the Buddha bless you?

  • Erica

    Food inflation is real, and it is here. Just yesterday I compared my receipt from a grocery run to prices I have from the same exact store from September 15, 2009. Bacon? Up 52% to $13.69 from $8.99 for 4 lbs. Butter? Up 73% to $9.99 from $5.79 for 4 lbs. Pure vanilla extract up 14% to $6.79 from $5.95. Chopped dried onions up a mere 2% but minced garlic (wet) was up 32%. The ONLY thing that I have hard data from in both visits and went down is canned chicken – that declined by 9% though there was a demonstration on that product so I am curious if the price will be higher next week.

    I would tell you to check your receipts from last year but 1) hardly anyone keeps them and 2) they are nearly all printed thermally so they fade in less than a year. Food inflation is here!

  • Something Wicked This Way Comes

    There is a solution. There always has been.

    I just finished a 4 part series on the private banking cartel and monopoly that some people refer to as the FED.

    Education. The FED doesn’t want you to know there is an alternative. There always has been. Audit the fed and get rid of the parasite that is killing it’s host. See it here.

    http://thecivillibertarian.blogspot.com/

  • Sammyone

    STU

    I absolutely agree. The politicians can’t save us. But they can accelerate the downward slide. That seems to happen more often when one party runs the show. Hence by call for voters to divide the government.

  • TnAndy

    “Bring on the inflation..i would love minimum wage to be $19.95 per hour i could pay off all my debts in a month…

    plus my landlord owns his house free and clear so my rent wont go up as much as your debt ridden broke landlord.”

    Seriously ??

    What good is paying off your debts when you won’t have a job ? If min wage goes to 19.95/hr, the will manage to outsource burger flipping off shore, or to a robot.

    And your landlord….think his OTHER costs are gonna sit still ? Property taxes, insurance, utilities, maintenance ???

    What a doofus……

  • noname

    I am no economist. Just a person who has been wiped out by life’s events. My home, kids college money, 10 years of labor…

    My house lost 100k in value in two years. That is deflation. However, food prices are clearly increasing. So my guess is that we are going through a deflationary period with inflation sub-bubbles.

  • Talnik

    Erica: check the weight of your canned chicken. For example, canned tuna is the same price but went from 6.3 oz, to 6 oz, to 5 oz and now some have only 4.5 oz of tuna in the can. That’s 29% inflation for tuna just this year. Cans that used to be packed with tuna are now half water. Other stuff: toilet paper, 200 sheets per role now 178 sheets, paper towels too. Some coffee is the same price but appears to have ground-up shells mixed in it.

  • Tom

    Republicans want to get rid of the middle class.
    They want to reduce labor costs to boost profits. Tax breaks will be given to millionaires and the working class will lose benefits.

    Support Harry Reid and stop the billionaire take over.

  • noname

    Perhaps someone can answer this question for me, why is the banks buying treasury bonds and the fed is buying treasury bonds.

    I heard that the banks took the TARP money and bought up TBills. Please explain.

    Thanks.

  • http://WBDM Joe in JT

    I don’t save my supermarket receipts for a year but I do notice “staple” foods and remember their price. Lettuce used to be .99 for ages, now it’s a 1.69 a head. I like Idaho instant mashed potato’s that was just .99 now it’s 1.29, hey that’s a 30% increase. Eggs were 1.69 to 2.50 but today they are 3.99 ! I could buy a 30 pack of Old Mil Best beer for 9.99 on sale, now it’s 16.99 plus the tax is higher. I live on Marie Calander and Claim Jumper TV diners and buy in bulk when they are on sale for 1.50 to 2.00 . Foster Farm whole chicken is a good deal when it’s on sale for .77 lb. Today I made beer can chicken, my dog liked it anyway.

  • Something Wicked This Way Comes

    Dear No Name;

    The Federal Reserve creates money by issuing debt in the form of treasuries. Member banks borrow money from the FED at essentially .25 and make the difference up to about 4% in treasury yields (interest). The FED also buys maturing securities from the banks/other holders and refinances with new securities. U.S. debt is bought by other countries/foreign banks/investors. The U.S. uses the money to finance it’s out of control government. What it amounts to is a giant check kiting, Ponzi scheme, that never ends. The net effect is that taxpayers and savers get screwed. Taxpayers pay the FED and their shareholder banks “interest” on what should be our own money. Savers have their buying power reduced through inflation as the private FED reserve just floods the marketplace with debt.

    If you are still confused, read about the “FED” here:http://thecivillibertarian.blogspot.com/…I have embedded some great links and video.

  • Bruce

    Vote for Reid LOL sure the Demoncrats are doing such a great job spending us into a Depression. Wait until you find out all the hidden taxes inside the Health Care bill you Demoncrats will love it but of course you will blame it on the Bush either way. The Neo-Cons are spending us just as fast into a hole with the Military budget. It is time to vote them all out.

  • http://None mactheknife

    Thanks again EC for the inflation scenario which is what quantitative easing is all about and the fed has stated it will follow that course!
    All economies world wide are in the same boat, all have been loosing exports and none greater than the USA. Bush and now Obama are afraid to take the necessary action to stop China and perhaps other countries from manipulating their currency to guarantee greater exports and higher employment within their own countries.
    All we have to do is look at the amount of cash and US Bonds held by our greatest trading partners to tell who is ripping us off. Which is really American wealth transfered to those countries in trade which in no way can be considered fair! I personally was astounded that Bush did nothing and even more so when Obama sent treasury and economic experts to China several times to bitch, but took virtually no positive action to stop the hemorrhage of US dollars and jobs. So now the fed is going to do what they have been doing to lower the dollar value so we can export more and I believe that is the wrong answer! we need to fight back with placing import duties on all products coming from those countries that manipulate currency.And not manipulate our currency to get even. That in itself will raise the price of the things we import and that will cause some inflation but it is far better than trying to flood the world with dollars to lower the currency exchange rates.
    This would encourage investors in the US to manufacture more here and purchase less from overseas increasing our employment and reducing theirs. If we were to immediately increase taxes back to pre-Reagan levels/take away all corporate subsidies and tax loopholes and tax shelters from all individuals and corporations who sell or produce here, then use that money to create infrastructure jobs while cutting all the defense spending that moves goods and services out of the country we just might reverse this bleeding in a few years and keep america’s people together instead of seeing a huge % rapidly becoming homeless and without jobs to support a basic living needs .While Freddy and Fanny are becoming the owners of america’s homes instead of our people thanks again to Bushes modernization of the bankruptcy laws in ’05. Now we need to start a national jobs program for all young people who need employment or face huge social problems with that element unemployed, and we need free education for those who can benefit society by getting it!But not MBA’s who are learning how to fleece fellow Americans or invent new investment instruments that few understand and make money for the investment houses and agony for regulators and pension funds or school boards who are the investors of choice being ignorant as babies about sophisticated investment instruments!
    Like thousands of other vets I was educated by the GI Bill after service in Korea. We shouldn’t have to risk the lives of our young to make out nation smarter and better able to compete with the other nations of the world in innovation and implementation of ever improving systems of cost effective education, living, (food, housing, medical care and transportation and production of goods that people all over the world need. Why has higher education not automated so that the cost is a fraction of what it was 50 years ago we’ve seen unbelievable improvement in productivity in almost every industry except education; why? Why can’t I take any class I want to by online computer tutorial with a email back-up for details and misunderstanding and take tests at testing centers where proctored exams can be certified!
    Thats the way I took my NASD series 7 exam and the NTE for social studies. Why not all other types of specialized education?
    All economic systems are rigged to gradually move wealth into fewer and fewer hands! it’s human nature to favor the people you know and even more the ones you love so government must produce systems for redistribution to counter that natural process. Our founding fathers knew this and tried to build the philosophy into the Bill of Rights and the constitution with fair success, Roosevelt #1 Teddy,used that principal to bust up the trusts and monopolies that strangled social and economic progress for the majority of our people and it helped till wealth concentration by ’29 was again strangling us and then R #2, FDR, used the same principal to start lots of job programs and legislation like The Wagner act etc that gradually reduced the concentration of wealth to a level that allowed our country to boast of a middle class with assured upward mobility for most who would strive to archive it. Now we again have a wealth concentration perhaps even greater than in ’29 because then people and money mostly stayed at home! Now with safe money harbors like Switzerland and the Caribbean banks offering to obstruct national tax collection and Politicians openly supporting tax avoidance at the same time jumping into foreign adventures with our over done military (america spends more on military the all the other nations of the world together, Why??? to address problems that military could never solve, to take Americans minds off the real problems of society and create imaginary boogiemen to fear and excuses to take away our guaranteed freedoms of free speech etc. with the promises that they wouldn’t use the powers on regular Americans just those bad guys we can all identify??? Why are we still in Iraq when it has been long since established that there are no WMD’s there? Why are we in Afghanistan Al Quieda isn’t there!They are mostly in Pakistan or they are now a world wide club thanks to Mr. Bush’s absurd policies. Al Queida is a Protest group with violent objectives all because America supports the Jewish state unconditionally no matter what outrageous things they do to the Palestinian peoples or their neighbors. Remember the trashing of Lebanon?
    That was the reason for the Al Queida movement and world war against terrorism is no solution to that problem.
    Sometimes I need to spill out an old mans complaints against these politicians who tell us what to think and produce an ever more convoluted mess of our national economics and social democracy with completely ridiculous rational that has been proven not to work but they seem to stay in power and keep doing what doesn’t work! So when will the American people get enough of this charade? And start demanding social policies that will bring us back to the principal of creating the most benefit for the most people and supporting the less able by taking a bit more from the most crafty in manipulating or “gaming”that system.

    Mankind, in every religion, and every society from the beginning of time have recognized that the principals of “the golden rule” are the only thing that advances humanity! We are our brothers keeper!
    Now we are finding out that all living things are our brothers as well, that the web of life can’t be broken or we will be extinct just like the thousands of species now vanishing from mother earth every year while we play ones upmanship with one another. When my grand father was a boy there were vast open places without humans now there are virtually no habitable areas without people! When I was a boy the oceans were still pristine even though we had reduced whale and fish species in some parts. Now Google “trash in the Oceans” or “fish species no longer available” for commercial fishing to harvest! You older Americans will remember the “codliver oil” threat which is no longer possible as the cod have been eliminated as a catchable species.
    Yes we have a national crisis and our political system seems to be unable to cope partly because that one percent of wealth holders are in complete control of the information media! and control our legeslative process as well as the well intentioned regulatory system! So we lost 29 miners here in WV, because a Mine was maximizing profit instead of maximizing safety! Again the regulators were essentially captured by the industry to guarantee their profit.
    I get very good health care as a vet. ” socialized medicine is the answer not health care for profit! So at present 1/3 of all Americans have no health care or questionable coverage with some huge deductible H/C insurance policy that not one in twenty really trust to come through when the payer will call on it to pay their bills, 1/3 have coverage via some government agency few understand and the last 1/3 have very good coverage as long as their employer or they can keep up ever increasing premiums…Last year most went up 15% or more. One of my friends got two rate increases each nearly 10% in one year! How can a business be so bad at estimating their costs? The better question is when will the American people get enough of this nonsense and take to the streets instead of the poles. Where nothing changes no mater who is elected to office with promises, promises, promises! The “change you can believe in” turned out to be a myth just like WMD’s in Iraq! I know some of you will have fun with this post but every bit of it is fact even if my memory of percentages is fractionally off. This post is by a man 79 years old who has spent his life trying to understand the why’s and if I live another 79 i’m sure i’ll still have as much to learn as I’ve learned to date! Nobody can ever know it all, thats why we devised a system of government that provided almost unlimited debate of issues so we could get enough facts and develop a consensus we could live with that would benefit the most of us while protecting the minorities and those helpless to protect themselves!
    Where did it go???

  • EC-reader

    The rampant inflation is the ‘image in the mirror’ of the bacchanalia that is going on on Wall Street in the last decades.
    However I have a question – the people that have invented the system should have predicted its behavior and its impact on the economy – why haven’t they done this? The things that are going on with the national debts, for example, should have been forecast in the past. Where are these forecasts?

  • Teresa

    Four horse of the Apocalypse are coming and the third one is black famine, followed by death of a quarter of humanity. What happens in USA, effects the rest of the world, much of which is already so sick and starved and close to dying, so they will die quicker than healthy and well fed people. How sad we are being brought to this point.
    Repent & pray that you may be forgiven and reconcilled to God through Jesus on the cross and that you may be worthy to escape all these horrors to come. They are coming for sure. Read a bible and pray for wisdom to understand, you are going to need it in the near future.

  • Teresa

    The end game is the destruction of the dollar so a regional and eventual a world currency can rein, Matt said.

    I don’t think many people get that but it is refreshing to see that a few are aware. Thanks. A lot of great radio and headlines pulled and discussed at christianworldviewnetwork.com w/ Brandon Howse.

  • Lisa

    It’s very frightening to think of a hyperinflationary event taking place in the US (or BRA, if you wish). In 2001 I worked with the Latin American division of an international company and I remember very well what my colleagues in Argentina went through during the financial crisis that year. Most Americans have no idea what happened there and they would be wise to find out what happened and how the people coped with it.

  • chris

    Inflation is prophesied in the bible to be out of control in the time of the end!
    Revelation 6:5 When the Lamb broke the third seal, I heard the third living being say, “Come!” I looked up and saw a black horse, and its rider was holding a pair of scales in his hand. 6 And I heard a voice from among the four living beings say, “A loaf of wheat bread or three loaves of barley will cost a day’s pay.[b] And don’t waste[c] the olive oil and wine.”

  • Jackson

    Lisa,

    I was listening to the radio and they were talking about the 80% inflation in Brazil not so long ago. People had to buy and stock up on food before the prices change every day when the sticker man labels the products.

  • http://obbop.wordpress.com/ Obbop

    “There’s class warfare, all right, Mr. (Warren) Buffett said, but it’s my class, the rich class, that’s making war, and we’re winning.”

  • Federalist45

    Talnik: You wrote: “Erica: check the weight of your canned chicken. For example, canned tuna is the same price but went from 6.3 oz, to 6 oz, to 5 oz and now some have only 4.5 oz of tuna in the can. That’s 29% inflation for tuna just this year. Cans that used to be packed with tuna are now half water. Other stuff: toilet paper, 200 sheets per role now 178 sheets, paper towels too. Some coffee is the same price but appears to have ground-up shells mixed in it.” All true–I have noticed all the reduced-size packaging in the last year or two, and noticed, as well, that prices are the same or higher. In short, we get less for the same or more money. That said, to Erica I would say, “Stop buying canned chicken!” Have you not been following how about 99.9% of all chicken Americans eat is raised? And then to get it canned. My guess is that alot of that comes from even worse conditions than those present on U.S. chicken farms (from farms in China or other Asian or South American countries). For you own good, don’t eat canned chicken.

  • EatTheRich

    Warren Buffet & his partner can Go to Hell – Rich B*stards! I am sick of ALL the Elitists telling ALL of US LITTLE PEOPLE to Suck It UP & STOP being so NEGATIVE!

  • Randy Churchill

    End the FED. Just get rid of it and all the criminals that run it. It is a ponzi scheme plain and simple. Forget thinking the political system will save you. Until the go back to honest monetary policies nothing will change. End the FED NOW!

  • http://westendmuses.blogspot.com/ Chris

    We do save our reciepts (over the course of the last 2 years) as it pertains to animal feed and the prices are squeaking up. 1.00 here, a 1.50 there, 2.00 over there. Hay is up too, even from the local guys we get it from. Just 1.00 a bale, but when you buy 100 plus bales, it’s a hundred bucks.

    Three years ago we got very frustrated over the gas prices and living in such a rural area we were practically stuck with not being able to drive like we used to. Silly that it would cost 2.50 just to go to town 10 miles away and back. So we opted to look deeper into the economy and what was really happening and it scared us to death. So we started our little mini sustainable farm and are still trying to make it fully productive for us over the course of a year. We are very close. Rabbits 80-100 of them at all times and it allows for about 1300 lbs of meat a year. Dairy/Meat goats – 3 does and a buck, 6 new babes next year and at least 8 months of milk if we do it right. And cheese. Chickens, 30 of them bringing in about 15 eggs a day. Composting worms because we need to do something with all this manure (LOL) and for our garden. We also live in the pacific northwest with a maritime climate and do not have to worry as much about losing and starving livestock over the winter. It’s not real fun in the winter up here with hurricane force winds and storms coming out of Alaska but it’s green all year. So not bad for animals. Better than Wyoming, where I grew up.

    We also have a reasonable sized garden area to grow most of what we need. I say most…we get too much water and cool weather summers so tomatoes are tough without a greenhouse. Anyway, potatoes, carrots, oninions, beans, peas, lettuces and such all do well. And blackberries and apples out the ears. All on one acre if you can believe it. We do a lot of canning and make our own wine. Our water is gravity fed from a natural spring up the ridge from our house, plus we have a year round creek running on the property – and filters, LOL

    Anyway, our other basic needs in other goods like flour, coffee, sugar, rice, dried beans, soaps, tp. etc etc have all gone up and or the packaging has been reduced with price point staying the same. We are most definately paying more in all of these.

    One excellent thing here is that we knew something was wrong 3 years ago and we did not like being caught with our pants down (so to speak) so we started doing something about it. We are almost fully there. Not quite but very close. All due to the gas prices going up over 5 bucks a gallon out here.

    Not everyone can do this of course. We are fortunate to have at least an acre of land. Three years ago I was in the 10th year of being a professional fine artist. Talk about a canary in a mine shaft. I noticed discretionary spending drop three years ago as it pertained to my art. Went from a very nice monthly income down to nothing in 2 years flat. So I gave all that up (business wise at least, I still paint) and pursued becoming more self sufficient. Never have done any of this before and just picked up some books.

    I do highly suggest however that folks do something, do something right now. The snowball is rolling down the hill now and we want to survive this in one piece and come out the other side.

  • Mike

    Why do christians use fear to push their religion? They go to colleges and look for weak confused kids and try to convert them. They go to poor countries and feed them in exchange for their freedom. They are the root of the problem.

    Restore freedom. Ban christianity.

  • Jackpile

    Buy gold and silver. NOW.

  • Icky Chew

    thats awkward. guess what happened in Zimbabwe. you have to pay freakin 100,000,000 Zimbabwe dollars for Outback Steak House

  • http://blank Verna Waloven

    I just discovered how we can cut a Trillion Dollars in one year! Watch this http://bit.ly/zz6Bmh

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