Inflation eats the value of the currency. Prices are not going up because things are more expensive than before, for the most part at least they are similar. The prices go up to reflect the devaluation of currency due to inflationary policies. The change in society, the real change, happen when people realize what inflation is and not think of it as prices are going up, but rather as purchasing power of currency going down. That realization makes all the difference. When the critical mass of people understand that, things change. In the meantime, we can observe the myriad of bad consequences that result from "free money" that really is not money, but credit.

If it wasn’t for politicians and central bankers finding it impossible to resist either using currency as a tool for economic management or simply as a source of funding government spending, the distinction between money, which evolved into gold through market forces, and currency, always a creature of the state, might not matter.

But the British economist John Maynard Keynes, quoting Lenin said: “There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction and does it in a manner which not one man in a million is able to diagnose.”

Modern monetary economists define hyperinflation as any inflation rate above 50 percent per year. In the 1920s, Germany had inflation rates in the thousands of percent.

Far too many German marks were being created under the privately controlled Reichsbank. Exactly how, will be discussed shortly. These excessive issues drove down the value of the mark:

By July 1922, the German mark fell to 300 marks for $1; in November it was at 9,000 to $1; by January 1923 it was at 49,000 to $1; by July 1923, it was at 1,100,000 to $1. It reached 2.5 trillion marks to $1 in mid-November 1923, varying from city to city.

Since the 1900's US dollar's purchasing power fell by about 98% or more, compared to gold. It won't be long now before history repeats itself. No fiat currency has survived. Every single one has eventually been made worth less because of inflation until its pointless to own one.

I don't think we would ever see wokeness unless it was something that inflation bubble allowed for at the expense of real money and meritocracy.

"Kind of like how Howard Hughes was able to afford the luxury of madness, like a man who not only thinks he is Napoleon but hires an army to prove it." —Ted Morgan

When you can mouse click yourself into existence trillions of dollars on your balance sheet in a second, you can afford to hire that army and support the insanity bubble thinking you are Napoleon. does not make it so.

When the FED runs out of proverbial ink do to people's realization of what fiat dollars are, it will be game over and society will have started again, with real money. Gold and Silver. There is no other way. Although in a last desperate attempt to extend the life span of the empire of lies, we might see forceful introduction of CBDC. So-called Central Bank Digital Currency, which is neither currency, not money, but social or rather anti-social credit system designed for two things. To extend central control over the population and to pretend debt is no more and we can start from scratch. As it happens neither of those goals can be achieved with CBDC, but it might extend the suffering and illusion for a little longer. Before the great reset, not of the central bankers but of the empire of lies.

.............

Economic Death Spiral

Tuesday, Mar 21, 2023 - 09:25 PM

Authored by Robert Stark via Substack,
Fed Trap: Financial Collapse or Hyper Inflation?

With this banking crisis, which has serious Lehman vibes, it is a good time to revisit my article, Is This The End of The End of History, from March of last year. The article dealt with the theme of collapse vs stagnation, and historical cycles, in light of the Ukraine war, the post-pandemic climate, the onset of inflation, and speculation about economic collapse. A point of mine, that has especially been vindicated, is that “a delay in the Fed raising interest rates, could cause a short term rally in stocks, further expanding the bubble. The bigger the bubble, the worse inflation gets, and the longer the Fed keeps delaying raising rates, the worse the crash will be down the road.” For the most part, most of my geopolitical and economic forecasts have come true, though I actually predicted an economic collapse to occur sooner, which actually vindicates that point, that kicking the can down the road will just create a much worse crisis.

Despite countless signs of economic volatility, the recent bank failures, with shockwaves to the entire financial system, are a turning point, where it is clear that there is going to be a severe economic downturn. For instance, Elon Musk recently said, lot of current year similarities to 1929, and Moody’s cut the outlook on the entire U.S. banking system to negative from stable, citing a "rapidly deteriorating operating environment." Even the perma bulls, mainstream media, and financial “experts,” can no longer deny the obvious signs of economic peril. However, the bullish propaganda was still strong as recently as January, which was really the bulls’ last gasp, with the monkey rally, in response to the Fed only raising interest rates by .25 points, plus economic data showing record low unemployment plus a dip in inflation.

This is the perfect storm with inflation, stagflation, recession, a potential debt crisis, as well as energy and supply chain issues. With this bubble to end all bubbles or too big to fail on steroids, the Fed has two choices, cause a liquidity crisis by shrinking the money supply, or letting inflation rip. While raising rates appears to be the least bad of these two options, further rate hikes are futile with the return of QE. A combo of QE plus interest rates having to remain high, is what could lead to that scenario of inflationary financial collapse, that Peter Schiff warned about. Though most likely it will either be long term stagflation or a deflationary Depression. This is not a hyperbole, nor clickbait, but a Depression is a very real possibility, especially if policy makers continue to kick the can down the road, to prop up the bubble.

full article at ZeroHedge: [zerohedge.com]

[zerohedge.com]

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