Powered by debt

Millions have lost their jobs or had their pay slashed in the last year. Now, they'll face the full wrath of the money printer:

The invisible tax of rising inflation will do far more to harm working and middle-class Americans than Biden’s proposed tax hikes. The trillions of dollars in congressional spending and money printing from the Federal Reserve is already having a dramatic effect on the price of ordinary goods. [...]

Over the past year, food prices are up 3.5 percent, with eggs and meat up by over 5 percent; gas is up 22 percent and is expected to get even higher by this summer; lumber is up 250 percent; new home prices are up $36,000, with overall housing up 11 percent; and new cars are up 9 percent, the highest in 68 years. In April, 13 percent of new car buyers paid more than the sticker price. Other goods — from household items, baby care and general merchandise — are already up between 5.2 and 7.2 percent from this time last year. The cost of eating out shot up by 3.7 percent over the past year, and some takeout specials such as chicken wings have nearly doubled. Coffee futures are up 24 percent since October. Even growing your own food has surged in price, with the cost of seeds and potted plants jumping by 10.5 percent.

I was thinking about buying a new PC recently. The actual price of the whole build comes out to almost double the MSRP! And that's assuming all the parts are even available for purchase. As of right now, the top three 3000 series GPUs from Nvidia are sold out in Canada.

The primary driver of the current inflation comes through money printing by the Federal Reserve. The Fed nearly doubled its bond purchases since the beginning of the pandemic, pumping almost $4 trillion into the economy. This is about as much as the Fed purchased between 2008 and 2014, during the worst of the Great Recession. From February 2020 to March 2021, the total of circulating cash, mutual funds and banking deposit money supply increased from $15.473 trillion to $19,896 trillion. The Fed effectively monetizes the federal government’s debt, creating both a cover for higher deficits and increasing the money supply further. From 2019 to now, the national debt jumped from just under 80 percent of gross domestic product to over 100 percent.

We had a one-month stock market crash last year. We're due for a giant meltdown like we had in 2000 and in 2008.