The debasement of the Canadian Dollar: Inflation rate falls to 0.1 per cent as price growth slows – #LateStageSocialism – August 19, 2020,
Do you want to know the real reason why a lot of humans hate capitalism and free markets? The reason people hate capitalism is because of DEFLATION! You’ll even hear so-called Conservatives and Libertarians talk about driving down the cost of labour as being a bad thing.
No! driving down the cost of labor is the whole point of a free market, I don’t like being forced to work harder at SOMETHING when I don’t have too! However in a market economy, the less I work the fewer dollars I’m paid, so what’s the solution for deflation?
You prevent deflation by discovering better more efficient uses for resources. So as I’m writing this living in Canada in 2020 is a dream come true, if I compare it to living in Canada in the 1970s, computers and the internet have replaced typewriters and snail mail as an example.
This is a deflationary force, now what hasn’t happened in Canada since the 1970s is the government getting smaller, no, instead what’s happened as technology has improved is the Canadian government has gotten bigger and more expensive to manage.
minimum wages have gotten higher and higher wages when there’s a permanent income tax equates to more money for the government. It’s in the government’s best interest to run inefficiently, otherwise, the government would be forced to shrink in size, which would obviously fuel entrepreneurship which again is bad for the government, because entrepreneurs are more demanding of their government than are the wage slaves, who feel economically helpless in the face of tyranny.
Entrepreneurs also create deflation in the economy, because as an example instead of wasting paper and time on a typewriter, a computer solves multiple publishing related problems without wasting paper and delivery time and for a fraction of the cost. If this deflation is left alone by the government it would make our lives better while pushing the cost of living down and making more things affordable to the poor.
When a country manufactures a lot of things or has free trade a lot of things are given away for FREE! As an example if Canada didn’t have a supply management system, Canada would have too much food, we’d probably have to export food to avoid waste. We have a lot of food now, but the government convinces you that it’s right thing to do to inflate the cost of labour and prices you pay at the grocery store. That’s not a function of the central bank, that’s the stupidity of the average Canadian voter.
As an example, the Canadian government has created a carbon tax, just to make sure that the Canadian economy doesn’t experience massive deflation. Now in order for the bank of Canada to supposedly print money, there has to be a lack of money in circulation, correct? Well, what this means is that without the BoC providing liquidity to the markets, the Canadian economy would be deflating.
With all the money printing Canada’s inflation rate fell to 0.1%, meaning in the real world Canadians are spending less, which can not continue because in the later stages of socialism the economy is propped up by prices never deflating. The money has to continuously be printed because if deflation is able to pin inflation to the floor, it means asset prices have reached a ceiling and this is what I call a cash flow problem.
Because if liquidity no longer has any utility, it’s a signal to the markets that the currency will have to be debased. So if let’s say the Canadian dollar was on a gold standard and 30 Canadian dollars equated to 1 ounce of Gold, well in that situation the powers that be would have to change that number to maybe to 60 Canadian dollars equaling 1 ounce of gold.
Now in fiat money terms, what debasement really means are higher interest rates, but because interest rates are being suppressed, the risk and the cost of the Canadian dollar debasement is going to be passed onto the Canada’s poorest people in the form of PRICE inflation. When price increase, the labour market wants an increase which obviously means debasement.
Inflation of assets also equals higher prices and try to remember that bank liquidity doesn’t mean that you will qualify for this cheap money, that’s what is so devastating about dollar debasement! If you don’t qualify for a loan and an expansion of the supply of credit, you are screwed, you won’t even be able to buy a cash producing asset.
This is later stages of socialism and this is why when the world embraces socialism it leads to poverty and worst of all IGNORANCE!
Inflation rate falls to 0.1 per cent as price growth slows, StatCan reports | thestar.com
Interesting times ahead!