![](https://i.imgur.com/CLvY2jA.png")
20-12-2021, 10:51 AM
John Ransom
13 Dec, 2021 15:25 / Updated 6 days ago
......
There are several things happening that have combined to create this inflationary environment.
Generally, inflation is caused by too much money chasing too few goods and services in the marketplace.
......
The world central banks, led by the US Federal Reserve, have injected an unprecedented amount of money into world economies, as a way of combating the expected economic downturn caused by the Covid-19 lockdowns.
Contributing to that rise in the US were the massive financial stimulus measures that were enacted first by President Trump and then by President Biden that put huge amounts of money directly into bank accounts.
In the US alone, money supply rose US$5.7 trillion or 38%, from near US$15.5 trillion to over US$21 trillion in a little more than a year, at a time when the economy wasn’t making any money.
That US$5.7 trillion has finally found its way into the economy and is now chasing a limited amount of goods and services prices upward, hence the rapid rise in inflation.
......
The inflation we are experiencing now is also a consequence of not having the robust worldwide supply chain that we have come to depend on over the past few decades.
......
The Covid quarantines – and global decoupling from China – broke this worldwide machine and the supply chain that used to keep prices down is now contributing to higher prices, because it’s either producing or delivering too few goods and services.
......
finally, in what’s known as “death spiral inflation,” workers are agitating for higher wages to keep pace with inflation, which, when granted, contribute to higher inflation as rising labor costs have to be figured into prices for goods and services. This is repeated ad infinitum until the economy collapses – unless measures are taken to cool it off.
......
In order to tame rising prices, world central bankers, led by the US Federal Reserve, will try to cut off or moderate the flow of new money into economies mostly by raising interest rates.
......
That means that not only it will be more expensive to borrow money for everyone all over the world, from governments, to corporations, to homeowners, to students, but the economic growth that we all rely on will be dialed back considerably.
......
What does that mean for me?
It means that you should try to make your life as normal as possible.
If you don’t have a job now, find one; if you are offered a job, take it; and if you have a job, keep it.
The global economy will likely continue to grow above historic norms for a few years more, even with higher interest rates.
https://www.rt.com/news/543060-rising-pr...Newsletter&utm_medium=Email&utm_campaign=Email
13 Dec, 2021 15:25 / Updated 6 days ago
......
There are several things happening that have combined to create this inflationary environment.
Generally, inflation is caused by too much money chasing too few goods and services in the marketplace.
......
The world central banks, led by the US Federal Reserve, have injected an unprecedented amount of money into world economies, as a way of combating the expected economic downturn caused by the Covid-19 lockdowns.
Contributing to that rise in the US were the massive financial stimulus measures that were enacted first by President Trump and then by President Biden that put huge amounts of money directly into bank accounts.
In the US alone, money supply rose US$5.7 trillion or 38%, from near US$15.5 trillion to over US$21 trillion in a little more than a year, at a time when the economy wasn’t making any money.
That US$5.7 trillion has finally found its way into the economy and is now chasing a limited amount of goods and services prices upward, hence the rapid rise in inflation.
......
The inflation we are experiencing now is also a consequence of not having the robust worldwide supply chain that we have come to depend on over the past few decades.
......
The Covid quarantines – and global decoupling from China – broke this worldwide machine and the supply chain that used to keep prices down is now contributing to higher prices, because it’s either producing or delivering too few goods and services.
......
finally, in what’s known as “death spiral inflation,” workers are agitating for higher wages to keep pace with inflation, which, when granted, contribute to higher inflation as rising labor costs have to be figured into prices for goods and services. This is repeated ad infinitum until the economy collapses – unless measures are taken to cool it off.
......
In order to tame rising prices, world central bankers, led by the US Federal Reserve, will try to cut off or moderate the flow of new money into economies mostly by raising interest rates.
......
That means that not only it will be more expensive to borrow money for everyone all over the world, from governments, to corporations, to homeowners, to students, but the economic growth that we all rely on will be dialed back considerably.
......
What does that mean for me?
It means that you should try to make your life as normal as possible.
If you don’t have a job now, find one; if you are offered a job, take it; and if you have a job, keep it.
The global economy will likely continue to grow above historic norms for a few years more, even with higher interest rates.
https://www.rt.com/news/543060-rising-pr...Newsletter&utm_medium=Email&utm_campaign=Email
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