Anything but Austerity: Until Central Banks Normalize Interest Rates, Prices will continue to rise, Bernie Sanders joins striking Kellogg’s workers in Michigan – December 19, 2021,
In case people forgot, Barack Obama gave Bernie Sanders the National platform he enjoys today. Barack Obama along with Ben Bernanke bailed out Wall Street. The wall Street bailout gave the socialist movement hope and Donald Trump actually helped to accelerate the problem when Trump sent Americans a preview of Universal Basic Income by sending Americans government checks not to work in 2020. Trump also complained to Jerome Powell to lower interest rates, so the best economy the world has ever known as he called it -would be allowed to continue.
Is that capitalism? If you say yes, based on the circumstances, well then Bernie Sanders has a right to complain? So here we are, via the idiot policies/regulations coming from the Biden administration, prices for everything are rising and if consumer prices are rising, why shouldn’t the price of labor also get a pay increase?
Making matters worse, Donald Trump sent Americans checks in the mail when Covid-19 hit, which allowed governments to shut down the economy? a lot of people welcome the Omicron variant, because maybe if they’re lucky, they’ll get another round of free money from the government? Now, if I was an economic ignoramus I’d assume that the government could do this forever without consequence and maybe I’d think now is a good time to start going on strike?
So what’s the solution to this economic madness? The solution is simple but unlikely to happen, the solution is for the Federal Reserve to normalize interest rates and allow the too big to fail to go bankrupt. The economy is clearly DEFLATING, but in order to combat a deflating economy, the government is printing money. This central bank liquidity we know as near 0% interest rates, is allowing malinvestment all over the economy and this malinvest is mostly in Wall Street and in the GOVERNMENT!
It wouldn’t surprise me in the slightest if a labor movement sweeps the United States, the problem is that the increases in prices are going to accelerate the problem because you have to remember that SHORTAGE problems are accelerating, there’s a housing shortage, worker shortage, chip shortage, there’s a shortage in everything except for the government workforce and government regulations.
Everyone looks to the government to fix problems and not the private sector and this is happening because the Federal Reserve is sending the wrong pricing signals. When the federal reserve sees inflation, it’s supposed to adjust interest rates accordingly, now the Fed doesn’t have to behave exactly the way a free market system would behave but at the very least if inflation is at 5% the fed could raise interest rates to 2.0%?
Why the Federal Reserve and other central banks don’t want to raise rates is because higher interest rates would signal to the government that its big government ideas aren’t working and its time shrink itself. But nobody wants austerity measures right now, austerity is such a dirty word, so these basic easy to fix economic problems are going to accelerate, so you’d be wise to start preparing for challenging times ahead today!
Interesting times ahead