Posts Tagged ‘inflation’

“It’s EZ credit that is the linchpin in today’s fake-money system.

The Deep State’s stocks, bonds, and real estate values… not to mention its careers, incomes, and reputations… depend on it.

And it is made possible by the China trade… by Chinese workers who put in long hours in miserable conditions in order to stock the shelves of Walmart with cheap goods… by Chinese manufacturers who undersell their competitors to keep consumer price inflation in the U.S. at low levels… and by Bank of China, which holds some $1.25 trillion worth of U.S. bonds… thus propping up the whole wobbly capital structure….

In politics and economics, BS is all there is. The calculations are almost always fake; the statistics are quackery; the theories are devilish nonsense. And bad ideas never entirely disappear, they just re-emerge after a few years… often dressed in new duds.”

-Bill Bonner

“Americans feel squeezed because the cost of rent, medical insurance, and tuition – as well as other basic living expenses – is rising much faster than their wages. This creates very real problems for ordinary people.

By every measure – including stagnating wages and rising costs – things have been going downhill for the American middle class since the early 1970s. August 15, 1971, to be exact. This is the date President Nixon killed the last remnants of the gold standard. Since then, the dollar has been a pure fiat currency.

The rejection of sound money is the primary reason why inflation has eaten up wage growth since the early 1970s – and the primary reason why the cost of living has exploded.

Measured in gold, wages in the U.S. have fallen over 84% since 1971…. Priced in gold, the minimum wage has fallen 87% since 1968. Note that the federal minimum hourly wage was $1.60 in 1968. It’s $7.25 today, or 353% higher in dollar terms. But that $7.25 buys 87% less than $1.60 did back in 1968. That’s the story you won’t hear from the mainstream press.

Inflation follows a clear a pattern of corruption:  In a fiat currency system, the government will invariably print an ever-increasing amount of currency. This makes prices and the cost of living rise faster than wages. The average person feels the pain, but doesn’t understand what’s happening. More people support politicians who promise freebies. In order to pay for the ‘freebies,’ the government prints more money. This creates even more inflation, and the cycle repeats.”

-Nick Giambruno

“The definition of inflation is simple. It’s a general rise in the price level….  So you can…think about inflation not as a rise in prices, but as a change in the value of money. When the value of money changes, other things will rise or fall in price.

That’s the definition. Measuring inflation is much more complicated….

We’re concerned with general inflation as a monetary phenomenon. Health care and college prices will keep rising, we’re sure. But the cost of everything else rising is the true threat…” -David Eifrig

“Traditionally, inflation has been defined as ‘an increase in the amount of currency in circulation’….   Unfortunately, in recent decades, even dictionaries have been offering a revised definition of inflation, as ‘an increase in the price of goods and services’….

The purpose of bank-created inflation is to extract wealth from the populace.  By regularly increasing the amount of currency in circulation, banks create an environment in which the concept of debt appears to be beneficial. As a result, virtually everyone in today’s society not only has debt; he actually believes that he couldn’t improve his life except through debt….  In essence, the inflation concept was invented by banks as an invisible tax—a means by which they could extract wealth from the populace.

In effect, the individual is used by the banking system as a milk cow. For his entire working life, inflation is carefully adjusted to extract as much monetary value from his labours as possible, whilst still leaving him capable of continued production….

Refuse to borrow money for any situation. Yes, it will mean that, as your friends show off their new cars, you’ll be driving an older model. They’ll also live in nicer houses than you and they’ll ‘own’ their own house before you do. But, at some point, since you’re free from debt, you’ll pass them by and eventually retire well.

By understanding inflation, and acting on that understanding, the odds of living your life as a milk cow can be greatly diminished.”

-Jeff Thomas

“Commercial banks operated on sound classical principles. It’s a different story these days. Central banks and commercial banks are essentially Ponzi schemes, and engines of inflation. It’s a major reason the rich are getting richer—which is OK, except that today it’s at the expense of the middle class.” -Doug Casey

“The inflation process is the increase of the money supply.” L. Carlos Lara

“The actual process of money creation takes place primarily in banks.” -Federal Reserve Bank of Chicago

“Inflation is the creation of money and credit beyond the savings rate.  You see, the real impact of this new money comes when it enters the banking system.” -Porter Stansberry

“At more than $1.4 trillion in loans outstanding, student loan debt is nearly four times bigger than all the debts of Greece.  And it’s still growing at nearly 20% a year… multiple times faster than the official rate of inflation.  Worse, the government’s own data has showed as much as 30% of this debt – nearly one out of every three loans – isn’t being paid or is already in default….

At more than 1,000 schools – representing about one-quarter of all U.S. colleges and trade schools – more than half of students have already defaulted or failed to pay even one dollar toward these loans within seven years of leaving school.  Across all schools, the data show as many as 40% of borrowers haven’t paid a single dollar toward these loans within seven years.  Looking at just the past three years, this number jumps to more than half – 54% – suggesting this problem is only getting worse, not better.

In other words, according to the government’s own data, at least 40% of this debt – representing more than $500 BILLION that has been packaged up, ‘securitized’, and sold to investors as ‘money good’ – will likely never be paid back at all.” -Porter Stansberry

Smart Debt

Posted: December 4, 2015 in Debt
Tags: , , , , , , ,

“Here’s the smartest thing you can do with debt: Take out the largest, longest-term fixed-rate mortgage you can on your home, especially with rates near all-time lows….  Yes, I know it’s a comfort living in a debt-free home….  The bottom line is, in a few years, as interest rates and inflation go up, you’ll see that mortgage as a gift.” –Doug Casey

“Like the repeated doping of a horse, the boom is kept on its way and ahead of its inevitable comeuppance by repeated and accelerating doses of the stimulant of bank credit.  It is only when bank credit expansion must finally stop or sharply slow down, either because the banks are getting shaky or because the public is getting restive at the continuing inflation, that retribution finally catches up with the boom.  As soon as credit expansion stops, the piper must be paid, and the inevitable readjustments must liquidate the unsound over-investments of the boom and redirect the economy more toward consumer goods production.  And, of course, the longer the boom is kept going, the greater the mal-investments that must be liquidated, and the more harrowing the readjustments that must be made.” -Murray Rothbard