Most Americans don’t understand the horror of the looming inflationary wave | Local News

Most Americans don’t understand the horror of the looming inflationary wave

| News Today | Google News

If you are 55 or younger, you have no living memory of what it means when inflation takes over our economy. It is not simply that the price of everything goes up. It is a recipe for killing the economy and will fuel a black market and reduce the revenues that federal, state, and local governments depend on to provide services.

I graduated from high school in 1973. America was on the cusp of a major inflationary crisis (I encourage you to read the article that is linked here):

This is the gruesome story of the great inflation of the 1970s, which began in late 1972 and didn’t end until the early 1980s.8 In his book, “Long-Term Actions: A Guide to Long-Term Growth” (1994), Wharton professor Jeremy Siegel called it “the greatest failure of US macroeconomic policy in the postwar period.”

The high inflation was attributed to oil prices, currency speculators, greedy businessmen, and greedy union leaders. However, it is clear that monetary policies, which financed massive budget deficits and were supported by political leaders, were the cause. This mess was proof of what Milton Friedman said in his book Money Mischief: Episodes in Monetary History: Inflation is always “a monetary phenomenon.”

TRENDS: Psaki on Inflation: “The American People Are Not Considering Cost-to-Cost Comparisons From This Year To Two Years Ago” (VIDEO)

Great inflation and the recession that followed ruined many businesses and hurt countless people. Interestingly, John Connally, the Nixon-installed Secretary of the Treasury who had no formal training in economics, subsequently filed for personal bankruptcy.

We weren’t just paying higher prices for food and gas. If you wanted to buy a home, you had to pay double-digit mortgage interest. If you are now buying a $ 300,000 home with a $ 60,000 down payment, your monthly payment at 3.8% is $ 1,401.63. What happens when the interest rate is 16%? You will pay $ 3,510.75. What do you think it does to home sales? Kill the real estate market.

I had the misfortune to live in Argentina in 1984 during an incredible period of hyperinflation. Inflation rose to 1,000% annually. Prices for food, fuel, and everything else went up during the day. If you bought an apple in the morning for 50 cents, you would pay 75 cents in the afternoon. Imagine that you are a small business owner who has to change the price of your merchandise constantly (that is, every two hours). It’s a nightmare

This period in Argentina was devastating for the middle and upper middle class. A dear friend was a baker. Provided cakes served in Aerolineas Argentina. Before the inflation peak, I would buy a new truck every two years. He lived in a 4,000-square-foot house. His name was Alberto. He sold his house for $ 250,000 right at the beginning of the inflationary spiral to build a new bakery. When the sale was completed, the agent forgot to pay the property tax on the property he sold.

During 1984 he struggled to complete the bakery. He had to sell his beautiful Ford truck and buy a junk. The price of glass, wood, concrete and tiles was going up every day. Alberto was like a man trying to stay afloat on Lake Michigan during a storm with concrete blocks stuck to his feet. The construction was finally completed and it opened its doors to the public. But the cost of everything needed to run a bakery made it impossible for him to stay in business. Went bankrupt.

The worst news came in late 1984. He was notified that he had to pay his tax bill on the land he had sold. It was adjusted to compensate for inflation. He owed $ 260,000. That is what happened to the value of the Argentine peso in just one year. The land tax cost more than he got for selling the damn house.

I visited Alberto in 2002. He lived with his new wife and three young children in a ramshackle 1500 square foot shack and bathroom. There was a hole in the wall that left the bathroom open to the freezing air outside (it was August, which is winter in Argentina). Oh yeah, it didn’t have hot water. Try taking a cold shower when it’s 40 degrees outside.

I pray that we are not headed for an inflationary peak. But the federal government is lying to you about the real inflation rate. You are told that it is only 5.3% right now. However, this calculation excludes food and fuel. Do you think they are not worth considering when determining the rate of inflation? Let’s take gas as a telling example. The price of gas has up about 68% in the last year. That is not 5.3%. You’re seeing a similar jump in food. Beef is up more than 30%.

If you have an adjustable rate mortgage, get rid of it as soon as possible. I don’t know how high the actual rate of inflation will go, but I do know that Joe Biden and his team are totally incompetent. Unrestricted spending by the feds has sown the seeds of an inflationary wave that will dwarf what we experienced in the 1970s. I encourage younger people to read a little and prepare. You don’t want to end up like my friend Alberto. It was tragic.

Top Stories abc News Most Americans don’t understand the horror of the looming inflationary wave

Jewel Beaujolie

I am a fashion designer in the past and I currently write in the fields of fashion, cosmetics, body care and women in general. I am interested in family matters and everything related to maternal, child and family health.

Related Articles

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Back to top button