There is no way to understand the virulent all sectors inflation that has overcome the American economy apart from the fulcrum financial event of modern times. That is, Richard Nixon’s scrapping of the Bretton Woods monetary arrangement and the dollar’s last link to gold at Camp David in August 1971.
Well, that should settle it. The June CPI came in 5.32% ahead of last year and up 3.00% per annum on a two-year stacked basis.
What mental dungeon do they dig these people out of?
The toxic spawn of the Fed’s pro-inflation money-pumping is omnipresent. Today’s Wall Street Journal heralded still another case, reminding us once again where the thousands of corporate zombies now barnacling the main street economy get their financial feed:
The usual suspects are flyspecking the Fed’s June minutes for hints as to what this camarilla of madmen, dolts and dunderheads may do next, but that rather misses the point. The real takeaway is that the Fed amounts to an exceedingly dangerous committee of dilettantes, who have absolutely no clue about what they are doing. …
As we indicated in Part 1, the idea that market driven GDP should find its own natural level without a heavy-handed assist from the fiscal and monetary arms of the state is the polar opposite of the reining Phillips-Curve-in-one-country orthodoxy. Instead of viewing the US economy as an instance of vibrant capitalism, the latter depicts …
Inflation has always been about more than bothersomely high prices like a $3 cup of coffee or a $4 gallon of gasoline. And nowadays it also encompasses far more than Milton Friedman’s axiom that it reflects too much money chasing too few goods.