Tag Archives: stagflation

Prepare to Be Bled Dry by a Decade of Stagflation

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By Charles Hugh Smith

Source: Of Two Minds

The Great Moderation of low inflation and soaring assets has ended. Welcome to the death by a thousand cuts of stagflation. It was all so easy in the good old days of the past 25 years: just keep pushing interest rates lower to reduce the cost of borrowing and juice credit expansion ((financialization) and offshore industrial production to low-cost nations with few environmental standards and beggar-thy-neighbor currency policies (globalization).

Both financialization and globalization are deflationary forces, as they reduce costs. They are also deflationary to the wages of bottom 90%, as wages are pushed down by cheap global labor and stripmined by financialization, which channels the vast majority of the economy’s gains into the top tier of the workforce and those who own the assets bubbling up in financialization’s inevitable offspring, credit-asset bubbles.

To keep the party going, central banks and governments pushed both forces into global dominance: hyper-financialization and hyper-globalization. Policy extremes were pushed to new extremes: “temporary” zero-rate interest policy (ZIRP) stretched on for 6 years as every effort was made to lower the cost of credit to bring demand forward and inflate yet another credit-asset bubble, as the “wealth effect” of the top 5% gaining trillions of dollars in unearned wealth as asset bubbles inflated pushed consumption higher.

Corporate profits soared as credit became essentially free and super-abundant and globalization lowered costs and institutionalized planned obsolescence, the engineered replacement of goods and software that forces consumers to replace their broken / outdated products every few years.

Every economic lever was pulled to extend the vast profits generated by hyper-financialization and hyper-globalization. Currencies were manipulated lower to boost exports, cheap credit kept zombie companies alive, bridges to nowhere and millions of empty flats were built to boost jobs and profits, and so on.

At long last, all these gimmicks have reversed or reached marginal returns: they no longer keep inflation suppressed, asset bubbles inflating and profits expanding. The malinvestment of global capital will be revealed and the costs of the policy gimmickry will be paid by years of stagflation: high inflation, low or negative growth and endless debt crises as the reliance on cheap credit to boost profits comes home to roost.

It turns out that the inevitable offspring of hyper-financialization and hyper-globalization are inflation, credit crises and the undermining of national security as the self-serving goal of pushing corporate profits higher via globalization led to fatal dependencies on competing powers for the essentials of modern life.

Correcting these decades-long extremes will take at least a decade as long-suppressed inflation becomes endemic, supply-chain disruptions become the norm and capital has to be invested in long-term national projects such as reshoring and the engineering of a new more efficient energy mix–projects that will only be expenses for many years.

This demand for structural investments with no immediate profit payoff is what drove the stagflation of the 1970s, a factor I explain in The Forgotten History of the 1970s and The 1970s: From Rotting Carcasses Floating in the River to Kayak Races.

The gains will not even be measured by our current outdated economic metrics of GDP and profits. The gains will be in the national security of essential supply chains and production and in the relocalizing of jobs and capital, not corporate profits.

Our reliance on the endless expansion of credit, leverage and credit-asset bubbles will have its own high cost: the collapse not just of the current Everything Bubble but of the engines that inflated one bubble after another.

Central bank and state authorities are thrashing about cluelessly, as all their gimmicks are now problems rather than solutions. The current policy gimmicks laid the foundations for a decade or more of high inflation, low growth and credit crises as the phantom “wealth” of credit-asset bubbles evaporates.

This will drive a reverse Wealth Effect as the top spenders are crushed by the collapse of asset bubbles. Long-term trends in demographics (shrinking workforces and the skyrocketing population of elderly) and depletion of resources will add fuel to the inflationary / low growth / credit crises bonfires.

Gordon Long and I discuss all these mutually reinforcing trends in A Great Stagflation (36 min). This is the culmination of our decade of programs about all the policy gimmicks that were pushed to extremes to maintain the illusion of stability and growth–an illusion that’s evaporating as it makes contact with stagflationary realities.

The Engineered Stagflationary Collapse Has Arrived – Here’s What Happens Next

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By Brandon Smith

Source: Alt-Market.us

In my 16 years as an alternative economist and political writer I have spent around half that time warning that the ultimate outcome of the Federal Reserve’s stimulus model would be a stagflationary collapse. Not a deflationary collapse, or an inflationary collapse, but a stagflationary collapse. The reasons for this were very specific – Mass debt creation was being countered with MORE debt creation while many central banks have been simultaneously devaluing their currencies through QE measures. On top of that, the US is in the unique position of relying on the world reserve status of the dollar and that status is diminishing.

It was only a matter of time before the to forces of deflation and inflation met in the middle to create stagflation. In my article ‘Infrastructure Bills Do Not Lead To Recovery, Only Increased Federal Control’, published in April of 2021, I stated that:

“Production of fiat money is not the same as real production within the economy… Trillions of dollars in public works programs might create more jobs, but it will also inflate prices as the dollar goes into decline. So, unless wages are adjusted constantly according to price increases, people will have jobs, but still won’t be able to afford a comfortable standard of living. This leads to stagflation, in which prices continue to rise while wages and consumption stagnate.

Another Catch-22 to consider is that if inflation becomes rampant, the Federal Reserve may be compelled (or claim they are compelled) to raise interest rates significantly in a short span of time. This means an immediate slowdown in the flow of overnight loans to major banks, an immediate slowdown in loans to large and small businesses, an immediate crash in credit options for consumers, and an overall crash in consumer spending. You might recognize this as the recipe that created the 1981-1982 recession, the third-worst in the 20th century.

In other words, the choice is stagflation, or deflationary depression.”

It’s clear today what the Fed has chosen. It’s important to remember that throughout 2020 and 2021 the mainstream media, the central bank and most government officials were telling the public that inflation was “transitory.” Suddenly in the past few months this has changed and now even Janet Yellen has admitted that she was “wrong” on inflation. This is a misdirection, however, because the Fed knows exactly what it is doing and always has. Yellen denied reality, but she knew she was denying reality. In other words, she was not mistaken about the economic crisis, she lied about it.

As I outlined last December in my article ‘The Fed’s Catch-22 Taper Is A Weapon, Not A Policy Error’:

‘First and foremost, no, the Fed is not motivated by profits, at least not primarily. The Fed is able to print wealth at will, they don’t care about profits – They care about power and centralization. Would they sacrifice “the golden goose” of US markets in order to gain more power and full bore globalism? Absolutely. Would central bankers sacrifice the dollar and blow up the Fed as an institution in order to force a global currency system on the masses? There is no doubt; they’ve put the US economy at risk in the past in order to get more centralization.’

The Fed has known for years that the current path would lead to inflation and then market destruction, and here’s the proof – Fed Chairman Jerome Powell actually warned about this exact outcome in October of 2012:

“I have concerns about more purchases. As others have pointed out, the dealer community is now assuming close to a $4 trillion balance sheet and purchases through the first quarter of 2014. I admit that is a much stronger reaction than I anticipated, and I am uncomfortable with it for a couple of reasons.First, the question, why stop at $4 trillion? The market in most cases will cheer us for doing more. It will never be enough for the market. Our models will always tell us that we are helping the economy, and I will probably always feel that those benefits are overestimated. And we will be able to tell ourselves that market function is not impaired and that inflation expectations are under control. What is to stop us, other than much faster economic growth, which it is probably not in our power to produce?

When it is time for us to sell, or even to stop buying, the response could be quite strong; there is every reason to expect a strong response. So there are a couple of ways to look at it. It is about $1.2 trillion in sales; you take 60 months, you get about $20 billion a month. That is a very doable thing, it sounds like, in a market where the norm by the middle of next year is $80 billion a month. Another way to look at it, though, is that it’s not so much the sale, the duration; it’s also unloading our short volatility position.”

As we all now know, the Fed waited until their balance sheet was far larger and until the economy was MUCH weaker than it was in 2012 to unleash tightening measures. They KNEW the whole time exactly what was going to happen.

It is no coincidence that the culmination of the Fed’s stimulus bonanza has arrived right after the incredible damage done to the economy and the global supply chain by the covid lockdowns. It is no coincidence that these two events work together to create the perfect stagflationary scenario. And, it’s no coincidence that the only people who benefit from these conditions are proponents of the “Great Reset” ideology at the World Economic Forum and other globalist institutions. This is an engineered collapse that has been in the works for many years.

The goal is to “reset” the world, to erase what’s left of free market systems, and to establish what they call the “Shared Economy” system. This system is one in which the people who survive the crash will be made utterly dependent on government through Universal Basic Income and one that will restrict all resource usage in the name of “carbon reduction.” According to the WEF, you will own nothing and you will like it.

The collapse is engineered to create crisis conditions so frightening that they expect the majority of the public to submit to a collectivist hive mind lifestyle with greatly reduced standards. This would be accomplished through UBI, digital currency models, carbon taxation, population reduction, rationing of all commodities and a social credit system. The goal, in other words, is complete control through technocratic authoritarianism.

All of this is dependent on the exploitation of crisis events to create fear in the population. Now that economic destabilization has arrived, what happens next? Here are my predictions…

The Fed Will Hike Interest Rates More Than Expected, But Not Enough To Stop Inflation

Today, we are witnessing the poisonous fruits of a decade-plus of massive fiat money creation and we are now at the stage where the Fed will reveal its true plan. Hiking interest rates fast, or hiking them slow. Fast hikes will mean an almost immediate crash in markets (beyond what we have already seen), slow hikes will mean a drawn out process of price inflation and general uncertainty.

I believe the Fed will hike more than expected, but not enough to actually slow inflation in necessities. There will be an overall decline in luxury items, recreation commerce and non-essentials, but most other goods will continue to climb in cost. It is to the advantage of globalists to keep the inflation train running for another year or longer.

In the end, though, the central bank WILL declare that the pace of interest rates is not enough to stop inflation and they will revert to a Volcker-like strategy, pushing rates up so high that the economy simply stops functioning altogether.

Markets Will Crash And Unemployment Will Abruptly Spike

Stock markets are utterly dependent on Fed stimulus and easy money through low interest rate loans – This is a fact. Without low rates and QE, corporations cannot engage in stock buybacks. Meaning, the tools for artificially inflating equities are disappearing. We are already seeing the effects of this now with markets dropping 20% or more.

The Fed will not capitulate. They will continue to hike regardless of the market reaction.

As far as jobs are concerned, Biden and many mainstream economists constantly applaud the low unemployment rate as proof that the American economy is “strong,” but this is an illusion. Covid stimulus measures temporarily created a dynamic in which businesses needed increased staff to deal with excess retail spending. Now, the covid checks have stopped and Americans have maxed out their credit cards. There is nothing left to keep the system afloat.

Businesses will start making large job cuts throughout the last half of 2022.

Price Controls

I have no doubt that Joe Biden and Democrats will seek to enforce price controls on many goods as inflation continues, and there will be a handful of Republicans that will support the tactic. Price controls actually lead to a reduction in supply because they remove all profits and thus all incentive for manufacturers to keep producing goods. What usually happens at that point is government steps in to nationalize manufacturing, but this will be substandard production and at a much lower yield.

In the end, supplies are reduced even further and prices go even higher on the black market because no one can get their hands on most goods anyway.

Rationing

Yes, rationing at the manufacturing and distribution level is going to happen, so be sure to buy what you need now before it does. Rationing occurs in the wake of price controls or supply chain disruptions, and usually this coincides with a government propaganda campaign against “hoarders.”

They will hold up a few exaggerated examples of people who buy truckloads of merchandise to scalp prices on the black market. Then, not long after, they will accuse preppers and anyone who bought goods BEFORE the crisis of “hoarding” simply because they planned ahead.

Rationing is not only about controlling the supply of necessities and thus controlling the population by proxy; it is also about creating an atmosphere of blame and suspicion within the public and getting them to snitch on or attack anyone that is prepared. Prepared people represent a threat to the establishment, so expect to be demonized in the media and organize with other prepared people to protect yourself.

Be Ready, It Only Gets Worse From Here On

It might sound like I am predicting success of the Great Reset program, but I actually believe the globalists will fail in the end. That’s not going to stop them from making the attempt. Also, the above scenarios are only predictions for the near term (within the next couple of years). There will be many other problems that stem from these situations.

Naturally, food riots and other mob actions will become more commonplace, perhaps not this year, but by the end of 2023 they will definitely be a problem. This will coincide with the return of political unrest in the US as leftist factions, encouraged by globalist foundations, demand more government intervention in poverty. At the same time, conservatives will demand less government interference and less tyranny.

At bottom, the people who are prepared might be called a lot of mean names, but as long as we organize and work together, we will survive. Many unprepared people will NOT survive. Understand that the economic conditions ahead of us are historically destructive; there is no way that serious consequences can be avoided for a large part of the population, if only because they refuse to listen and to take proper steps to protect themselves.

The denial is over. The crash is here. Time to take action if you have not done so already.

The Fed Has Triggered A Stagflationary Disaster That Will Hit Hard This Year

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By Brandon Smith

Source: Alt-Market.US

I don’t think I can overstate the danger that the U.S. economy is in right now as we enter 2022. While most people are caught up in the ongoing drama of Covid-19, a REAL threat looms over the nation in the form of a stagflationary tidal wave. The mainstream media is attempting to place the blame on “supply chain disruptions,” but this is a misrepresentation of the issue.

The two factors are indeed intertwined, but the reality is that inflation is the cause of supply chain disruptions, not the result of supply chain disruptions. If we look at the underlying stats for price rises in essential products we can get a clearer picture.

Before I get into my argument, I really want to stress that this is a precarious time and I suggest that people prepare accordingly. In just the past few months I have seen personal expenses rise at least 20% overall, and I’m sure it’s the same or worse for most of you. Stocking necessities and safe-haven investments with intrinsic value like physical precious metals are a good choice for protecting whatever buying power your dollars have left…

Higher prices everywhere

The Consumer Price Index (CPI) is officially at the highest levels in 40 years. CPI measurements often diminish the scale of the problem because they do not include things like food, energy and housing which are core expenses for the public. CPI calculations have also been “adjusted” over the past few decades by the government to express a more positive view on inflation. If we look at the inflation numbers at Shadowstats, calculated according to the same methods they used in the 1980’s, we see a dramatic increase in CPI which paints a more dire (but more accurate) picture.

U.S. food prices have spiked to levels not seen since 2008 at the onset of the credit and derivatives collapse that brought about tens of trillions of dollars in Federal Reserve bailouts.

If we look beyond the 2008 crisis, food costs do not see a similar jump until the 1980s. Rising food prices in the US are often obscured by creative accounting and “shrinkflation” (shrinking packages and rising prices), but if we look at global food prices the average is a 30% jump in the past year.

Rental and home prices have also gone into the stratosphere. Rental costs went up around 18% in 2021, and this is an extension of a trend that has been prevalent for the past decade. Prices have been rising for a while, it’s just that now the avalanche has accelerated.

Home prices are currently out of the range of most new potential home buyers. Values jumped 16% in the past year alone, with the average property costing $408,000. Home sales continue to remain elevated compared to two years ago despite inflating prices for one reason and one reason only – the mass migration of Americans away from the draconian mandates and bureaucracy of blue states into more conservative states.

I live in Montana, a primary destination for people relocating, and from my experience the majority of these people are conservatives seeking to escape the vaccine and lockdown mandates in places like California, New York and Illinois. They see the writing on the wall and they are trying to get ahead of the economic and social calamity that will surely befall such states.

I would also note that home sales have finally begun to flatten in the past six months but prices are not dropping, which is a trend that I think needs to be explored further because it illustrates the larger issue of stagflation.

When inflation becomes stagflation

Understand that prices are not just rising because of increased demand (demand is starting to fall in many sectors), prices are rising because of increased money supply and dollar devaluation which is not yet being reflected in the Dollar Index.

Take a look at U.S. GDP and you will see that for the past several years it has tracked in tandem with price inflation. Obviously, if prices inflate then this means people are spending more, which then leads to higher U.S. GDP; it’s like magic, right? In other words, inflation makes it seem as though U.S. GDP is always improving.

However, this has not been the case in the past couple of years.

Official GDP has flattened despite the fact that U.S. money supply and inflation have rocketed higher. What does this mean? I believe it is a sign of stagflation and a reckoning in 2022. If we examine inflation adjusted GDP numbers from Shadowstats we see that GDP has declined rather aggressively in the past couple of years.

We can also see odd tendencies in oil and gasoline prices. While it’s true that gas prices have been higher in the past, this does not address the full context of the situation. U.S. travel spending has declined 12% since 2019 and airline travel has dropped at least 21% in the past year. Average gasoline usage dropped after 2019 and still has not recovered. Yet, gas prices continue to rise? In other words, travel demand is stagnant but prices are INCREASING – this is another signal of inflationary pressures and dollar devaluation. Oil is priced in dollars globally, and therefore any inflation in the dollar will be readily visible in oil. This would help explain why pandemic paranoia and reduced travel have not caused gas prices to drop.

If the current momentum continues the majority of necessities in the U.S. will not be affordable for most people by next year. We are looking at a fast-moving decline in production along with a swift explosion in prices. In other words, a stagflationary disaster.

This is the Federal Reserve’s fault

I and many other alternative economists have been warning about the inevitable inflation/stagflation crisis for years, but the most important factor to understand is WHO is responsible this event?

The mainstream financial media is going to protect the government and the Federal Reserve at all costs during this breakdown. They are going to blame Covid, the lockdowns here and overseas as well as the supply chain bottleneck.

The Fed is the true culprit, though.

While there have been many American Presidents and other politicians that have supported the Fed in its inflationary activities, the central bank itself needs to be held accountable for the downturn that is about to occur. This is a process that started back at the founding of the Fed, but spread like cancer after the crash of 2008 and the introduction of 12+ years of stimulus and bailout measures along with near-zero interest rates.

The inflationary end-game

The pandemic is the perfect cover for the inflationary end game. In 2008 the response to the crisis was to print and pump dollars into banks and corporations in the U.S. and around the globe. This money supply was held in corporate coffers and in central banks overseas, which slowed the effects of inflation. This set the precedent for subversive stimulus policies by giving the Fed a blank check to do whatever it wanted.

In 2020, the Fed created trillions more but this time the money was injected directly into the U.S. economy through Covid stimulus checks, PPP loans and other measures. In the alternative economic field we call this “helicopter money.” These dollars triggered a massive retail buying spree in 2020, but with more dollars in the economy chasing less goods prices are now spiking much higher.

The big discussion today is whether or not the Fed will taper their asset purchases, reduce their balance sheet and raise interest rates to counter inflation?

The fact is it won’t matter; inflation/stagflation will continue or even accelerate as the Fed tapers. With a taper comes the threat of a flattening yield curve in Treasury bonds as well as the danger of bonds and dollars being dumped by foreign investors and central banks. If the trillions upon trillions of dollars being held overseas come flooding back into the U.S., inflation will continue at its current pace or erupt even higher. In fact, the world’s ownership of dollars reached a 26-year low recently. The global transition away from the dollar, toward inflation-resistant investments, has already begun.

This is not a policy error

I explained this Catch-22 threat in my recent article The Fed’s Catch-22 Taper Is a Weapon, Not a Policy Error. In that essay I outline the Fed’s documented history of creating economic disasters that conveniently end up benefiting their friends in the international banks.

I also explained (with evidence) how the Federal Reserve actually takes its marching orders from the Bank for International Settlements, a globalist institution which along with the International Monetary Fund and World Economic Forum is openly seeking a one-world economic system and one-world currency system.

I do not believe that the Fed’s actions are a product of ignorance or stupidity or basic greed. I do not believe the Fed is scrambling to keep the U.S. economy afloat. I believe according to the evidence that the Fed knows exactly what it is doing. The pandemic offers a perfect scapegoat for an engineered crash of the U.S. economy which the Fed is trying to facilitate.

Why? Because the more desperate people are financially, the easier they are to buy off with false promises and a loaf of bread. They are easier to control. On top of that, with the U.S. economy reduced to second- or third-world status, it is easier to sell the public on the predetermined solution – total global centralization and far less freedom.

As the stagflationary crash plays out, never forget who was really the cause of the public’s suffering. In the fog of national crisis it is easy for the establishment to shift blame and responsibility and to cloud the truth. The inflation calamity is about to get much worse, and as it does we need to rally newly awakened people to take action against the central bankers and globalists behind it.

Stagflation Subterfuge: The Real Disaster Hidden By The Pandemic

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By Brandon Smith

Source: Alt-Market.us

In recent economic news, headlines are being dominated by concerns over rising bond yields. Increased bond yields are a sign of a possible spike in inflation and, logically, they call for the Federal Reserve to raise interest rates in order to prevent that inflation.

Higher bond yields also mean there is a competitive alternative to stocks for investors – both factors that could trigger a plunge in the stock market.

If one studies the real history behind the stock market crash during the Great Depression, they will find that it was the Federal Reserve’s interest rate hikes that caused and prolonged the disaster after they had created an environment of cheap and easy money throughout the 1920s. Former Chairman Ben Bernanke openly admitted the Fed was responsible back in 2002 in a speech honoring Milton Friedman. He stated:

“In short, according to Friedman and Schwartz, because of institutional changes and misguided doctrines, the banking panics of the Great Contraction were much more severe and widespread than would have normally occurred during a downturn. Let me end my talk by abusing slightly my status as an official representative of the Federal Reserve. I would like to say to Milton and Anna: Regarding the Great Depression. You’re right, we did it. We’re very sorry. But thanks to you, we won’t do it again.”

This then raises the question – inflation or deflation? Will the Fed “do it again?”

Probably not in exactly the same way, but we will see elements of both inflation and deflation soon in the form of stagflation.

It’s a Catch-22 that the central bank has created, and many (including myself) believe that the Fed has created the conundrum deliberately. All central banks are tied together by the Bank for International Settlements (BIS) and the BIS is a globalist institution through and through. The globalist agenda seeks to trigger what they call the “Great Reset,” a complete reformation of the global economy and capitalism into a single one world socialist system… managed by the globalists themselves, of course.

In my view the Fed has always been a kind of institutional suicide bomber; its job is to self-destruct at the right moment and take the U.S. economy down with it, all in the name of spreading its cult-like globalist ideology.

The only unknown at this point is how they will go about their sabotage. Will the central bank continue to allow inflation to explode the cost of living in the U.S., or will they intervene with higher interest rates and allow stock markets to crash?

Either way, we face a serious economic crisis in the near future.

 

Increasing Inflation Means Economic Recovery?

Mainstream economists will often argue that rising yields and inflation are a “good thing.” They claim this is a sign of rapid economic recovery. I disagree.

If “inflation” was the same as “recovery,” then there would not have been total economic collapses in Argentina in 2002, in Yugoslavia in 1994, or in Weimar Germany in the early 1920s.

I do not see recovery. What I see is the rapid devaluation of the dollar’s buying power due to massive fiat printing through stimulus measures. The Fed and the U.S. government are buying a short-term surge in economic activity, but at a hidden cost. This is a condition that the Dollar Index does not even begin to address, but obvious in prices of necessary goods and commodities.

Keep in mind that all of this is being done in the name of responding to the pandemic. The pandemic is the ultimate excuse for the active destruction of the U.S. economy. Stimulus measures have devolved into helicopter money being thrown about haphazardly as billions are siphoned primarily by major corporations and through fraud. People who are clamoring for a $2,000 relief check from the government have no idea that corporate welfare has been ongoing for the past year along with billions in retroactive tax refunds. All of that money printing is going to cause damage somewhere. It cannot be avoided.

 

It’s Not About The Pandemic

Let’s make something clear first: The pandemic is NOT the reason for the stimulus flood. The pandemic did very little to hurt actual business in the U.S. Rather, it was the lockdowns that did most of the damage.

Think about that for a moment – federal and state governments crushed the economy through lockdowns, then offered the solution of vast stimulus measures. This in turn is destroying financial stability and generating rapid price inflation.

Conservative states and counties that refused to shut down are recovering at a much faster pace than leftist states which imposed draconian restrictions on citizens. Yet, the lockdowns did nothing to stop the spread of COVID-19 in blue states. So, the lockdowns accomplished no discernible advantage for the public, but they did give the central bank a perfect rationale to further erode the dollar.

This resulting price inflation is something that not even the red states can escape.

For example, home prices are rapidly expanding beyond the market bubble of 2006. This is partially due to millions of people participating in perhaps the largest migration in the U.S. since the Great Depression. Anyone who is able is moving away from major cities into suburban and rural areas. But, home prices also have a historic habit of inflating along with currency devaluation. The cost of maintaining and remodeling an older home, or building a new home, rises as the prices of commodities like lumber inflate.

And lumber prices are certainly inflating! Softwood lumber prices are up at least 110% from a year ago, and are climbing as much as 10% in a week.

Home rentals also do not escape inflation, as the rising cost of maintaining properties forces landlords to increase rents. The only places where rents are decreasing are major cities that Americans are seeking to flee, such as New York and San Francisco.

 

Inflation In More Than Just Housing

The majority of commodities continue to see price inflation across the board. Food and energy prices have been creeping higher for the past year. Governments are once again blaming the pandemic and “stresses on the supply chain,” which may have been a believable claim nine months ago, but not today. Anything to hide the fact that all that stimulus has inflationary consequences.

Dollar devaluation is the most visible in terms of imported goods. In other words, it costs more dollars to buy goods outside the U.S. as the value of the dollar falls. And since the majority of U.S. retail is supplied by foreign producers, this means that average American consumers will suffer the brunt of inflationary consequences. Public stress and anger will be high.

 

Pandemic Lockdowns Are Just An Excuse

This is why the COVID-19 lockdowns must continue and the pandemic fear factory must remain active. The globalists need a cover event for the Reset and they need to keep the citizenry under control, and the pandemic can be blamed for just about anything. I think this is why we are already seeing the media hyping the existence of “COVID mutations.” Do not be surprised if the Biden Administration tries to implement a national lockdown sometime this year in the name of stopping the spread of a “more deadly” COVID-19 variant.

It won’t matter that the previous lockdowns were useless and all the data shows that keeping the economy open is a superior policy. It might seem like logic is going completely out the window, but there is a very logical reason for what is happening in the minds of globalists.

Stagflation comes into play through losses in certain sectors of the economy, high unemployment and the inability of wages to keep up with costs.

There is the continued dismantling of the small business sector, which, again, I believe is being destroyed deliberately. It’s not a mistake that small businesses were predominantly targeted as “non-essential” during the lockdowns. It’s also not a coincidence that the majority of COVID-19 PPP loans went to big box corporations while small businesses received almost nothing. The small business sector is being erased, leaving only the corporate sector to provide for consumers.

This may be why Democrats are so adamant about raising the federal minimum wage to $15 an hour. Wages are already rising according to market demand and region. The average non-skilled worker in the U.S. is making around $11 an hour. There is no need for the government to interfere, unless they have ulterior motives.

A $15 minimum wage would likely crush what’s left of small businesses, and only corporations that are receiving the bulk of stimulus dollars will be able to afford to pay workers the higher rate. On top of that, years from now the government could claim they “took action” to front-run stagflation by increasing people’s pay. But a $15 minimum wage is most useful to the establishment in the short term because it muddies the waters on the inflation issue.

Prices will continue to rise due to dollar devaluation, but the media and government will say that it has nothing to do with the dollar and everything to do with companies raising shelf prices to offset increased labor costs.

 

The Biggest Threat In The History Of American Society

I suspect that the establishment will do everything in its power to distract the public from the biggest threat in the history of American society – the stagflationary time bomb.

If they admit to its existence then the public could prepare for it, and they don’t want that. If Americans were to decentralize their local economies, support local small businesses instead of big box retailers, start producing necessities for themselves, and if they started developing currency alternatives like local scrip backed by commodities… then they would be able to survive a national financial crisis.

In fact, I guarantee that any community, county or state that takes these steps will immediately be targeted by the federal government, further revealing the truth: The establishment wants the public to suffer.

They want economic disaster. They do not want people to have the option of taking care of themselves. They need people scared, desperate and malleable, or they will never achieve their Reset agenda.