When The Coming Inflation Hits
by Joel Hendon(754)
At the current rate of the Federal government's printing additional currency to meet our spending frenzy, economists say that there is but one possible result, runaway inflation. The severity of it will depend upon how much currency we are stupid enough to print and spend. Printing money to hack your way out of a mess is not the answer. It is simply like an ordinary citizen printing money to pay of his debts...counterfeit. The only difference is everyone knows about it. If this were wise, then I would suggest we print up an additional ten trillion, or whatever the total is, and pay off our national debt! The problem is, it doesn't work. At one point in time, the American dollar was extremely sound because it was only printed up to the amount of the value of gold we possessed. It could always be backed up by our gold. That is when gold was valued at $32.00 per ounce. We had quadgoogles of it at Fort Knox, Kentucky. But when World War II came along and sapped our money, they began to print more money and borrow money from giant corporations. Before that war, let me tell you something. You could buy a six-pack of Coca Cola or Pepsi for $0.25. I'm not lying, I have been there, done that. You could buy a 50 count box of .22 caliber short cartridges for $0.10, or 3 for a quarter. First class postage for a letter was $0.03, until I was about 16 years old. Military personnel, when aboard ship, could buy a carton of cigarettes for $0.50. If a person had $0.50 in his pocket it was about the equivalent of $25-30.00 now. But after the war, prices began to rise. We couldn't believe when soda pops doubled in price to 10 cents. Postage stamps increased by a penny or so until they reached their present level. Now, this is a new wave of money printing and we will pay through the nose. You might say, oh well, wages will have to increase with the increased prices. And yes, they will, but they never increase ahead of those things, but behind. So while the years ahead are bringing this to pass, wages will drag behind and hard times will prevail. Just how bad this gets, depends upon just how fast the inflation occurs. With the volume of printing planned now, I would estimate that we will have double digit inflation for many years. Not only that, what happens with our government spending during these years. Inflation hits the government just as it hits us, so costs and spending will increase with them as well. With the ongoing wars with radical Islamists, possible war with Iran, even Russia and a number of smaller hotspots, North Korea, etc. balancing our national debt, ever, is extremely questionable. More money printing, more inflation. More than all this is what may occur at the G20 summit in April. It is highly likely that, sooner or later, the U.S. Dollar is going to be removed as the international base for the IMF. When that happens, the value of the dollar will hit rock bottom and, for instance, our GI's in foreign lands will use their payday to buy a Coke. Our federal spending will be forced to skyrocket. This will likely not show up until the economy begins to improve, but with improvement will come the inflation. Taxes will skyrocket with the inflation. They will have to, otherwise our money printing will be perpetuated and, like a dog chasing it's tail, It will continue to climb with no end in sight. What can be done? The government must curb their spending. All the grand illusions of every person with health care, alternative energy, foolishly chasing the imaginary human caused global warming, are delusions, rather than illusions. Things like our security and defense, cannot wait if we are to survive, but we must postpone our evanescent dreams of a utopia. This administration campaigned on promises of delightful things which we cannot afford, but they sounded good and they were elected. Even the stock markets recognized that and began drastic losses when the election was over. Our legislators must be awakened and forced to stop this radical spending before we reach a point of no return. Once you leap from a 20th story window, you have problems.
Webgazine Columnist.
Article submitted Tuesday, March 24, 2009 & read 447 times.
Leave Your Comments:
» left by John Short from Eureka Springs, CO (352 days 5 hours ago.)
Something that should be kept in mind is that inflation is the friend of home owners, home mortgages are helped by inflation, and home mortgages are the key issue with this recession.Respond to this comment
» left by Joel Hendon (352 days 4 hours ago.)
Thanks for reading and commenting John. Your comment has a certain amount of significance, but not nearly enough to want to see inflation. First of all, if your property value triples, along with everything which triples, you have property worth 3 times as many dollars but absolutely no more purchasing power. About the only ones who would be really helped, would be those who would be willing to sell their house to pay off their mortgage. As wages rise, it also helps one whose mortgages remain constant.. I appreciate your comments.
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