Busted: Bankers and The Global Economy

July 27, 2008

Expanding Inflation Risks U.S. Economy

The debate has been on since the United States has seen an alarming increase in the costs of essentials across the board. For years, the Federal Reserve has ignored the impact of energy and food prices in its computations for inflation. As a result of recent events, the Fed has been forced to retool its thinking, even though the Fed body of thought insists on using the same computations.

The Fed remains skeptical that high commodity prices will ripple through the economy, leading to broad price hikes and big wage increases. Why the Fed assumes that wage increases are even in the cards is beyond most economist thinking. The fact is that the United States is in the midst or very close to what the Federal Reserve and economists hate the most: the evil of stagflation. There won’t be appreciable increases in income, only hikes in cost, loss of jobs and the devaluation of the monetary system.

The myth is that the Federal Reserve can control (more…)

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