Why The USA Has Inflation

Is it Inflation or Impoverishment?

Executive summary : The people are protesting the price increases that are causing a decline in their standard of living. They do not know the main cause of this so are unable to organize to improve their lot.

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Part of the rise in prices is war spending. Fourteen billion dollars go to Israel, the honchos there take there cut and the rest comes back to arms manufacturers who spend it in the USA. No domestic goods or services were produced, so the moneys serve only to increase prices. Increased demand + supply stays the same = higher prices.

This substantial sum though is nothing compared with the five trillion dollars in COVID stimulus, which went mostly to the politically well connected. Whatever might they do with this colossal stash? Though the production of goods and services declined or at best showed a modest increase the stock market soared 50%. This however wasn’t enough to absorb all that moolah. What market is big enough to help out? Gold, too small. Bonds at almost zero interest were unattractive. That left housing. Housing shot up 49% as gargantuan institutions bought big. It appears that $1.5 trillion went to buying stocks and $1.5 trillion to housing. The US deficit during those two years was almost six trillion dollars, three trillion more than usual. In short, three trillion dollars was printed and given to the richest hence most influential institutions. They didn’t need it, so the money was used to drive up prices by buying stuff.

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By the way, inflation is one of those words that has been redefined over the past fifty years. Back then inflation was wage increases causing price increases causing yet more demands for increased wages and so forth in a spiral. For ordinary people wage increases are a thing of the past so inflation has been redefined as simply increases in prices. A more accurate name for this decline in the standard of living might be “sinking into poverty” or just “impoverishment” for short.

With impoverishment so widespread naturally the victims are protesting. While they might form a majority of the population, they lack organization and effective leadership so this complaining is ignored. Meanwhile the Ds are insulting their intelligence with the message that the victims are too dumb to realize how good things are. The impoverished surely notice both the rise of wealth of the owning class and the heavy-handed suppression of those who attempt to lead any challenge to this status quo. What next will the victims do?