How Coming Inflation Will Affect Daily Life in USA

Posted on June 3rd, 2011 by admin in Political Economy

Do you wonder what it would actually be like for inflation in USA to explode, as many now predict? There many historical examples. But Jonathan Hoenig of capitalistpig.com presents a current example in Belarus:

“In just one month, I have virtually turned bankrupt, the entire country has gone bankrupt,” one worker told the Associated Press this week. “I fought my bank to close my account and get 5 million rubles ($1,000) in cash, and I want to buy at least something before my money turns into dust,” said another, who found many supermarket shelves already cleaned out by consumers. From Germany in the 1920s to Argentina in early 2000 to Zimbabwe just a few years back, the scene is always the same: prices skyrocket as personal savings are destroyed. In Belarus, the prices of apples and diapers have already more than doubled; gas (if it can be found at all) is up 25%.

The cause of the collapse wasn’t profit-hungry speculators or nefarious free-market bankers, but a highly authoritarian government beset by massive regulation,intervention, state-ownership of businesses and spending. Government-controlled entities generate 70% of gross-domestic-product; inflation is conservatively running at 16% a year.

You can read his entire article here. This is a taste of what USA has coming if the Fed doesn’t precisely time its reductions in the printed money inserted into the system by actions such as QE2. Do think they will get it right?

 

One Comment on “How Coming Inflation Will Affect Daily Life in USA”

  1. Human

    Very scary but interesting post

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