Purchasing Power

Could Inflation Break The Back Of The Status Quo?

Unprecedented expansion of credit, wage inflation and much-needed limits on the power of central banks to give away billions to oligarchs will generate inflation. The central planners have successfully masked real inflation behind a smokescreen of official statistics, but eventually a wind will rise that blows the smokescreen away, and the reality of rising inflation will break the back of the financial-political status quo.

What Happens When Rampant Asset Inflation Ends?

The insanity of the two strategies to keep inflated asset prices alive is no hindrance to their implementation. The collapse of asset inflation will implode all the fiscal and financial promises based on ever-inflating assets and reveal the unsustainability of the status quo's strategy of substituting debt and asset bubbles for stagnating real income.

Inflation Hidden In Plain Sight

Can we be honest and say that many of the reductions in value, quantity and quality are actually instances of fraud?

Nigeria Says "Don't Panic, Banks Are Fine" Amid Currency Collapse, Inflation Spike Concerns

A month ago we warned of the looming hyperinflation coming to Nigeria (as well as much of Africa). It appears, following the central banks' rate hike to a record 14% (reach for yield anyone) in an attempt to stall the ongoing currency collapse, that Emefiele is worried, warning of "concern over headline inflation spike." Perhaps most worrying though, amid the chaos, Emefiele advised depositors in banks "to go about your business," adding that there was "no need to panic or worry." Hhhmm..

The Real Reason The "Rich Get Richer"

The new money substitute, which we’ve lived with for 45 years, is a fraud. A dollar in 1971 is worth about 17 cents today. In other words, it has lost roughly 80% of its buying power. The phony dollar has misled an entire generation into spending money it didn’t really have... doubling or tripling its debt-to-earnings ratio, and shifting more and more of its real wealth to the least productive people – the Parasitocracy.

The Real Message From Asset Inflation

The earliest signs are developing of hyperinflation, more correctly described as a collapse of the purchasing power of all the major government currencies. Extreme one-way bets aside, the overriding reason for valuation disparities is becoming more consistent with the downgrading of cash, rather than a revaluation of assets

The Essence Of Trump's Appeal To The Flyover Zone: "We Are Not Winning Anymore"

...Massive debts, no good jobs, faltering productivity, soaring entitlements, declining net investment and drastically shrinking household incomes add up to an unprecedented assault on America’s vaunted middle class. In fact, the middle class is shrinking markedly as an empirical matter and fading rapidly as an aspirational possibility. It is profoundly misguided Wall Street/Washington policy regime that has given rise to this massive economic failure. For more than three decades they have sown the wind. Trump is the whirlwind they are now reaping...

America Needs A Good, Old-Fashioned Economic Depression

A good, old-fashioned, pre-1929 depression (like the short-lived, eleven-month depression in 1920-1921, before the days of “modern” central banking and “enlightened” Keynesian intervention “cures”) is the only tonic that can clear out the malinvestment built up since the beginning of the fiat money era.

The Writing Is On The Wall (Again)

Yesterday, the S&P 500 hit a new all-time high. And the Dow just hit a new record close as well. If you haven’t sold yet, dear reader, this may be one of the best times ever to do so.

BofA Does The Full Math On What Minimum Wage Hikes Really Mean

There is an impact to employment when employers are forced to give workers more money... BofA estimates that a 10% rise in the minimum wage reduces employment by 2%; and adds that "the net benefit of raising the minimum is not clear based on the literature."

The Prospects For Money

"In my view, this new bout of turmoil in financial markets is the prelude to the final demise of government currency..."

Consumer Credit Jumps $19 Billion In May Thanks To New All Time Highs In Student And Auto Loans

The latest consumer credit report confirmed what we have now known for years: revolving credit remains stagnant at best, with just $2.3 billion in credit card debt added in May, a modest rebound from last month's $1.4 billion but certainly nowhere near pre-crisis monthly increase levels. Why not? Because US consumers once again found a way to "fungibly" convert non-revolving credit, namely auto and mostly student loans, into purchasing power.