Arm yourself with information RE inflation

[berni_mccoy]

I’m seeing lots of RW friends posting about inflation and how it’s Biden’s fault. The record inflation we are seeing is due to the massive amount of money that the Fed printed in 2020 to prevent the market from entering a recession.

About 1/3 of all USD in circulation today were printed in 2020! That is a massive devaluation of the USD. See the graph below:



Combine that with supply chain issues that have been happening throughout the entire duration of the pandemic and you are setup for the inflation we are seeing.

And the inflation is just the beginning of what’s coming. If the BIF is not enough to stimulate the economy, and I suspect it won’t be, we are going to be entering a recession within the next year.

If you want to learn why, see my earlier post on this here: https://www.democraticunderground.com/100215985292

[fescuerescue]

1. No matter who's fault it is. This is a crisis in the making.

We can ignore it and then react to it.

Or try to get ahead of it.

[berni_mccoy]

2. It may be too late

The Fed should have been preparing for this and hedging against inflation with interest rates but he refused to do it.

The money printing only ended last week.

[KPN]

5. Yep, it was "all hail the markets" meanwhile

retired shmucks like me, who knew it was all a fabrication, sidelined most of their retirement accounts out of preservation instincts, missed much if not knots all of the sky-rocket and are now left wondering if their account value is so deflated it no longer meets their planned retirement income.

[PoliticAverse]

3. "About 1/3 of all USD in circulation today were printed in 2020!". n/t

[Hoyt]

4. Unfortunately, the sitting Prez will get blamed. Ask Carter.

[berni_mccoy]

6. That seems to be the current trend of my RW FB contacts

I happily provide the info above in response.

[TreasonousBastard]

7. Which is exactly why Congress will do nothing about it

[MichMan]

11. Why would the current house & senate want Pres. Biden to be blamed?

[TreasonousBastard]

12. Not all of them, but just enough to make sure nothing passes.

[TheBlackAdder]

8. While 1/3 was printed in 2020, how much was taken out of circulation and destroyed?

[berni_mccoy]

9. Not nearly that much.

You are of course, free to find the answer… it’s out there.

[MichMan]

10. Looks like it went from 1.7 to just under 2.1 trillion.

How is that a third?

[berni_mccoy]

13. That chart is from Jan 2021.

As of May of this year it was up to 40%.

https://techstartups.com/2021/05/22/40-us-dollars-existence-printed-last-12-months-america-repeating-mistake-1921-weimar-germany/

[WHITT]

14. Ah

The record inflation we are seeing is due to the massive amount of money that the Fed printed in 2020 to prevent the market from entering a recession.

The Fed doesn't print money.

Money can't be printed unless the congress approves the issuance of bonds to cover the debt created to cover the money printed.

The Fed creates digital funds out of thin air, which does not add to the federal debt, nor is it inflationary. After whatever situation the Fed is addressing is over, then the Fed slowly destroys the digital funds, like it never happened.

As to inflation, fully one-third of the additional inflation above the 2.2% nominal base Fed rate, is due to the rise in prices of used cars.

[WarGamer]

16. +1000 nt

[berni_mccoy]

17. Ok. That is what everyone in finance and economics calls it

https://www.usatoday.com/in-depth/money/2020/05/12/coronavirushow-u-s-printing-dollars-save-economy-during-crisis-fed/3038117001/

The Fed is creating the equivalent of currency by doing what the Fed does to “credit” the funds use to purchasing securities.

[brush]

19. Will interest rates go up soon?

[WHITT]

21. Powell Says

late next year, but that could get pushed, again.

[WarGamer]

15. Does this take into account the drop in Currency Destruction by the Federal Reserve during 2020?

Hmmm?

[berni_mccoy]

18. Yes. It's the net increase.

[BadgerKid]

20. And the Fed has the audacity to pre-blame meme stocks

For any coming “instability”.