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I note that fed Chairman jerome Powell, keeps insisting that any inflation there may be in the US is only "transitory".
Whether this statement turns out to be true or not we will find out in due course.
The problem is, in some ways its irrelevant.
The loss of purchasing power is not Transitory, but permanent.
The only difference is whether your loss of purchasing power keeps increasing over time, or is stagnant, but it still stays.
As Denis Miller from Birch gold
Lucky I mad some money trading.
Mick
Whether this statement turns out to be true or not we will find out in due course.
The problem is, in some ways its irrelevant.
The loss of purchasing power is not Transitory, but permanent.
The only difference is whether your loss of purchasing power keeps increasing over time, or is stagnant, but it still stays.
As Denis Miller from Birch gold
For me, car registration and insurance went up by various amounts depending on the jurisdiction, as did household insurance (a whopping 29% over the past three years for a rental property in Darwin). My private health insurance has increased every year, as have local government charges. A simple filling at my dntist last week cost $440 bucks, up from the 350 I paid two years ago.Consider our imaginary friend Arthur. He nets $100 per month. After year of 5% inflation, Arthur’s monthly money buys 5% less. Next year, it turns out the inflation spike really was transitory, so the inflation rate goes to 0%.
Here’s the thing: Arthur’s monthly income STILL buys 5% less.
It’s as if Chairman Powell reached into Arthur’s pocket and stole $5 every month. Forever.
That’s why we called inflation the Federal Reserve’s tax that no one voted for and everyone pays.
Wolf Richter laid out the ugly scenario that plagues our savings right now:
Inflation is a game of Whac-a-Mole. One pops up as another backs off. So it could very well be that CPI inflation may be 4% next May, down from 5% now, and we’ll be celebrating that the 5% was “temporary,” and was replaced by 4%, hahahaha. But the purchasing power of the dollar that is lost every month is lost permanently. [emphasis added]
Of course this is nothing new. The dollar’s buying power has been on a downhill slide overall since June of 1913, with the exception of a notable four-year recovery from September 1929 to May 1933. (Another interesting correlation is the Federal Reserve was also established in December of 1913.)
Wolf also believes the dollar’s descent hasn’t reached the bottom yet, and that it never will. With a Federal Reserve that’s so terrified of deflation they’ll do anything to prevent it, there’s not much of a chance that any of that lost buying power will return.
Remember, even if inflation reaches zero, it will be too late — you will have already been robbed.”
Lucky I mad some money trading.
Mick