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Lookout Below
More government controls, red tape and higher taxes always increase the costs of living. This is eventually surpassed by deflationary defaults which make income, cash savings and credit scarce and more valuable.
By now, estimated Consumer Price Index fell 7%, and broad M-3 money supply fell 11%. This is not inflation or disinflation, but deflation and depression, the winter of our economic discontent. We may do better to welcome the opportunity to put our financial house in order.
http://www.shadowstats.com/alternate_data
This confirms FIRST comes the deflationary collapse, THEN cometh the hyperinflation.
For three generations, the Feds managed to stave off deflationary collapse without widespread panic and depression. Two generations witnessed only the occasional currency crisis and market crash or economic recession.
These Presidential Sabbatical cycles affected a minority of Americans like the PATCO strikers or those who gambled or leveraged too much when risky asset prices corrected. We saw this happen in every economic correction we lived through since 1949.
Now debt usury and derivative defaults became so large as to be unserviceable and uncollectible for a large part. Compounding debt obligations surpassed the point where interest and principle were payable by normal economic growth. This always happens with usury, which leads to war and poverty, one reason most spiritual texts of history banned it.
We are closer to the beginning of the Jubilee Generation Economic Winter than the end. People who do not understand this may suffer deep and lasting financial changes affecting themselves and their future generations.
Bad debts are always defaulted/forgiven as the economy contracts. This goes back to Deuteronomy and Leviticus in the Bible.
Baling out lenders, borrowing more money, controlling the economy or raising taxes does not work well to restore confidence or prosperity, as FDR and Hoover learned as they employed more government. Now, State, County and Local governments are furloughing or laying off people to balance their budgets.
