Dear Reader,
The United States Treasury — and its kissing-cousin Federal Reserve — moan and sob about inflation.
“Oh no, inflation is damaging the dollar. Inflation is impoverishing the American people. Boo hoo hoo. So sorry. So sad.”
Yet the tears are the crocodile’s tears. They are not authentic.
Here is the reality: Fiscal and monetary authorities are heart and soul for inflation.
Not hyperinflation, mind you — hyperinflation carries severe political risk. And hyperinflation carries great reputational risk.
These authorities are, after all, tasked with the dollar’s defense. And hyperinflation represents a vast dereliction of duty.
Yet the very same authorities are out for inflation… merely of a subtler nature.
They simply do not want you to know it. Why are they out for inflation?
Inflation Lightens the Chains of Debt
The United States national debt runs to $36 trillion.
Combined United States debt — public and private — crosses $100 trillion.
Yet inflation lifts debt’s burden. Inflation reduces the weight of the chains around the neck.
That is why a government sunk deeply in debt is out for inflation. Explains Freedom Financial News contributor Jim Rickards:
- The ($36 trillion) debt is unmanageable without inflation. Inflation favors debtors because they get to pay back the debt with depreciating dollars. It’s easier to pay down debt because you’re paying back debt with dollars that are less valuable than when you originally borrowed them. So inflation eases the real value of debt.
Uncle Samuel borrows a dollar. Under inflation he repays it in cents.
Yet the great grifter maintains access to a press that prints money.
He can satisfy his debts with it … in nominal terms at least.
The creditors are handed their money — their nominal money. In reality they are handed sawdust.
A Swindler’s Deal
Here is what the deadbeat tells his creditors:
“I borrowed $100 from you, good sir? Well, here is your $100 back, as promised. I hereby discharge my fiduciary responsibility to you. I have fulfilled my contractual obligations.”
“But the $100 I loaned you is now only worth $50 because of the vicious inflation you caused,” comes the bitter reply. “You’ve robbed me blind! You’re a goddarned crook, that’s what you are.”
“Your problem, not mine,” answers the deadbeat.
Is the business dishonest? The business is dishonest. Yet it is the business.
“The wicked borroweth, and payeth not again,” Psalms informs us.
That is Uncle Samuel for you.
This uncle of ours is a cad. He is a bounder. He is a scoundrel. He is wicked.
The Debt Has Actually Shrunk!
And so we come to Mr. Kenneth Fisher. He is executive chairman of the eponymous Fisher Investments. From whom:
- This may be the most controversial claim I’ve made… but… when the numbers are sorted out in real terms, Uncle Sam actually has less debt than years’ past, not more…
- The US’s real repayment costs on its debt… have shrunk drastically. Since COVID, official inflation rose fully 20%. But you and I know that it was really more than that — maybe 30%. So, 2020’s $27 trillion got shrunk in real repayment terms by maybe $6-8 trillion.
- Honey, they shrunk the debt! Or, put another way, inflation is your enemy, but it’s Uncle Sam’s friend — always.
Always indeed. More:
- Ever wonder why the Federal Reserve wants 2% inflation? Why not zero? Well, 2% seems small but really helps manage Uncle’s debt. Simple arithmetic. In 2024, the debt grows about $1.5 trillion, maybe $1.7 trillion maximum.
- But, 2% inflation decreases 2024’s [$36] trillion of debt in real, after-inflation value by $700 billion — offsetting almost half the $1.5 trillion … Functionally vaporized!
The United States dollar has shrunk some 20% since the departing president, Biden, swore his oath.
That is, the dollar in your wallet has shrunk some 20%. It is not one dollar but 80 cents.
The government’s dollar — meantime — is $1.20
Thus your loss is government’s gain. Thus your impoverishment is government’s enrichment.
Thus you have been swindled.
How do you like it?
Yet you may not have noticed it…
The Silent Tax
Inflation is a supremely skillful pickpocket. It is justly and aptly named the invisible tax.
It is a cat burglar on tiptoe.
The famed Milton Friedman once labeled inflation the “cruelest tax.”
I believe it is. Yet I propose another label: the scoundrel’s tax. And what is government but a giant scoundrel?
As the great, late Henry Louis Mencken observed of government:
- The natural tendency of every government is to grow steadily worse — that is, to grow more satisfactory to those who constitute it and less satisfactory to those who support it…
- Government is actually the worst failure of civilized man. There has never been a really good one, and even those that are most tolerable are arbitrary, criminal, grasping and unintelligent.
The United States offers no exception.
And only through inflation’s scoundrelism can the United States government swell to present dimensions.
The Biggest Government in History
Never has a national government — of any nation of Earth — exceeded its obesity.
I do not stretch or distort the facts.
Mr. Michael Snyder of The Economic Collapse site:
- Today, the United States has the biggest government in the history of the world, and it gets even bigger with each passing year… The federal government spent $6.13 trillion in 2023. That figure is larger than the GDP of every nation on the entire planet except for the U.S. and China.
The United States government devours some 36% of the gross domestic product.
The communist government of China — meantime — devours 33% of the gross domestic product.
Who Are the Totalitarians?
What about Mr. Putin’s totalitarian Hell?
Russia’s governmental proportion is precisely the United States’ governmental proportion — 36% of the gross domestic product.
Thus Putin’s totalitarian Hell is our democratic Hell.
Meantime, the nightmare theocracy of Iran devours a mere 12% of the gross domestic product.
Limited government!
In reminder: the United States government devours some 36% of the gross domestic product.
Only a thieving, swindling, scoundreling inflationary system can sustain it.
Thus I implore you to laugh down government sobs about inflation.
Government does not mean it. And its tears? They are false.
Regards,
Brian Maher
for Freedom Financial News
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