It’s on most of the news shows, and especially the business shows. The goal of the Federal Reserve, is to obtain a ‘normal’ inflation rate of 2%. Naturally, the Fed never tells the truth, and neither does the Federal Government., which the Fed is supposedly not a part of. Another lie. As an example, if you need or want a mortgage, currently it will be over 7%, as opposed to when Trump was in office, when it would be less than half that. The 2% goal, is to make your hundred – dollar bill, worth 98 cents at the end of the one-year period, rather than its current worth, which will be probably about 90 cents, or ‘officially,’ maybe 92 cents. In various parts of the world, it might be 50 cents or even a quarter. The two percent inflation, contrasts the fact that for over 100 years, there was no inflation, prices remained the same year after year, and your $100 would still be worth $100, other than during WW II, when it would probably be half, as that war was paid for with printing press money and inflation was probably 50%. After the war, in 1946, literally everything was twice the price it was before the war. and that was in just under five years. See what government spending does? Inflation took off during the years of FDR, when he inaugurated the welfare state.
There was a nice column about the Fed in Friday’s Journal, which pointed out that the Fed’s expenses are paid by profits on its shares, which are owned by its 12 member banks, and their profits currently, are negative. However, member banks have to pay for the Fed’s expenses anyway, and the member Banks are in a severely negative position, which threatens their solvency. Should we not use one of the ‘member banks?’ You decide.
Inflation is caused by, “An increase in the money supply,” and the fed mistakenly figured, that if it could discourage citizens from adding to the money supply with credit, mortgages, and time payments, etc., all of which fraudulently ‘add to the money supply,’ with credit, which would make a CPA have bad dreams. It didn’t and hasn’t stopped inflation, but the Fed lies as usual, and says ‘it’s under control.’ Rather, the Fed’s inflation, has virtually destroyed the real estate sales, auto sales, and virtually every other credit sale. The cause of inflation, is out of control, which is government spending, which legitimately adds to the money supply. Politicians wouldn’t allow that truth to be told, as they need continual handouts to gain votes to stay in office. And no, Donald Trump kept on government spending. Admittedly, some of it was to rebuild the military, but he was a piker compared to ancient, debilitated, Biden, whose spending has known no limits in stupidity or volume.
I checked on gold prices when I started dealing in it in November, 1977, and the gold price was $129.40 an ounce. Other prices? A new home cost $54,200, average family income was $13,572, a stamp was 13 cents, gas 62 cents a gallon, and a gallon of milk was $1.68. Eggs were 82 cents a dozen, and when I was born in 1934, they were 29 cents a dozen. Eggs alone, showed how far inflation had gone in the period from FDR to 1977. Had you started saving in gold rather than dollars, would you have done well? You bet.
We all know that there is nothing we can do to stop federal spending, which causes inflation, and there is no known way to stop politicians from incessantly spending and lying about everything, including Donal Trump. Inflation will continue, and all prices will continue to go up. Some years faster than others, but up. Check back years’ prices, and you will easily see. All we can do then, is to spend the decreasing dollars’ value, (inflation), to eat, drive and live, but for goodness sakes, do not save in them. Store your gas, oil, water in a bucket that leaks? Same thing as saving in unbacked paper dollars. Don’t. Save them in compact, eternal valued, gold, and even poor man’s gold, silver. Everything will ‘go up’ in dollar prices, because the presses will continue to run. I hope your Labor Day holiday was joyous.
-Don Stott- don@coloradogold.com