The simple answer is, of course, inflation.

The powers that be are trying to convince us that inflation is a good thing, a healthy thing, as Peter Schiff notes here:

“It is no accident that the concept of ‘inflation’ has experienced a dramatic makeover during the past few years. Traditionally, mainstream discussion treated inflation as a pestilence best vanquished by a strong economy and prudent bankers. Now it is widely seen as a pre-condition to economic health. Economists are making this bizarre argument not because it makes any sense, but because they have no other choice.”

I should note that, while there are a number of times I find Schiff hard to take, this is not one of them.  He’s exactly right.  Inflation is the bane of our existence.  It’s the hidden tax (that isn’t really hidden) that decimates the buying power of the average person, i.e., you and me.

Inflation is the bane of our existence because even though prices are inflated–that is, prices increase–there is no discernible or actual increase in the quality of the goods or services for which we are charged inflated prices.  The old saying “You get what you pay for” doesn’t really hold water under such circumstances.

Inflation is of course, also the reason that the dollar has lost virtually all of its purchasing power since 1913.  So what is The Financial System doing to keep us from rioting in the streets and surrounding government buildings?  They’re faking us out, as Schiff notes:

“We are creating debt now in order to push up prices and create the illusion of prosperity.To do this you must convince people that inflation is a good thing…even while they instinctively prefer low prices to high. But rising asset prices do little to help the underlying economy. That is why we have been stuck in what some economists are calling a ‘jobless recovery.’ The real reason it’s jobless is because it’s not a real recovery!  So while the current booms in stocks and condominiums have been gifts to financial speculators and the corporate elite, average Americans can only watch from the sidewalks as the parade passes them by. That’s why sales of Mercedes and Maseratis are setting record highs while Fords and Chevrolets sit on showroom floors. Rising prices to do not create jobs, increase savings or expand production. Instead all we get is debt, which at some point in the future must be repaid.

However, as Michael Hudson is fond of saying, debt that can’t be repaid won’t be.  Except in the case of The Financial System–they will again be bailed out once this new debt/infation bubble pops–their debts will be made good via taxpayer money.   As Schiff notes, this is already being done with quantitative easing and ZIRP, while we argue with each other over whether minimum wage should be raised.  Short answer–the minimum wage absolutely must be raised as long as this fictional system keeps creating fictional moneywith which to enslave us.  And which will be the cause of war after war after war after war in order to prop up this insane system.  See Dr. Hudson talk about fictitious capital here with Max Keiser (you simply must watch from approximately 2:00-4:00; sums it all up):

About eggsistense

Writer, musician, cartoonist, human being
This entry was posted in "supply and demand", Asset Bubble, class war, Debt, Debt Slavery, Everything Is Rigged, Federal Reserve, fiat currency, Iran, minimum wage, Price, Price-fixing, QE unlimited, Redistribution, Uncategorized, Wage slavery, Wages, Wealth transfer, ZIRP and tagged , , , , , , , , . Bookmark the permalink.

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