Joe Biden Shoots himself in the foot: “For consumers, the writing is on the wall that interest rates are likely to start climbing in 2022,” said Greg McBride, chief financial analyst at Bankrate.com – December 16, 2021
If someone were to ask me my thoughts on Joe Biden, I’d tell them from an economic point of view, he’s the dumbest President I’ve ever observed. So, his administration, for whatever reason have been pushing for better coverage from the media, now personally if I were Joe Biden, I would have done nothing, because Donald Trump love him or hate him, did a good thing by CUTTING regulations, Joe Biden on the other hand similar to Obama, has done everything in his power to not only reinstate prior regulations but create additional regulations for the U.S economy.
Making matters worse for the Biden administration is their desire to spend more money during a period of rising inflationary pressures. So, I’m not sure why the Biden administration did this, but they’ve been releasing job reports, that looked fudged if you ask me, and these job reports are showing questionable job numbers, that if I were their manipulators of information, I’d revise because these phony job numbers are helping the Federal Reserves case to raise interest rates.
Now, as we know, Jerome Powell was ready to raise interest rates under Donald Trump, Trump complained and the first chance Powell got he lowered interest rates, now the difference when Jerome Powell lowered rates under Trump were the fewer regulations on the U.S economy, meaning that it was easier and more profitable for a person to be productive under the Trump administration, but not so under Biden.
Joe Biden has been at war with American fossil fuel companies, which equates to higher energy prices, meaning that it’s costing people more money to go to work and to buy things like food, so once Jerome Powell starts raising rates, I suspect, there will be complaints, the problem with the coming complaints will be the penalties if Jerome Powell brings rates back down to where they are now because based on the current regulatory environment, inflation will accelerate again if interest rates return to where they are now.
Because the U.S has the world’s reserve currency, the U.S dollar is still doing pretty well internationally, but domestic regulations force costs up, and this is what the Biden administration doesn’t appear to comprehend. Yes, the Federal Reserve is to blame for bailing out an insolvent government that has no plans to be solvent, but Biden is making the problem worse by overly regulating the U.S economy.
If it costs more money to purchase fewer goods and services based on the new rules of the economy lower interest rates will only accelerate inflation, but on the flip side, higher interest rates are going to cause a RECESSION. Now, I like to simplify this argument by separating price inflation from economic DEFLATION!
Economic deflation is the reality of what happens to the economy when the government does too many UNNECESSARY regulations. Fiat money hides economic deflation, but as I like to point out, fiat money can’t hide SHORTAGES, shortages occur primarily because of the government. Even during natural disasters, humans find ways to be productive, however, if let’s imagine a virus happens in society and the governments’ response is to lock everyone in their homes? The end result is ECONOMIC DEFLATION, sure the government can print fiat money, but if there’s nothing the fiat money can buy, even if Venezuelan hyperinflation doesn’t happen in the U.S, there still will be SHORTAGES, which is another form of a recession.
So the question remains in a normal interest rate environment what is supposed to happen? I’ve been saying for years, that we’re headed for AUSTERITY MEASURES! Of course, I expect kicking and screaming and all sorts of fights to prevent austerity measures from happening, but I’ve been saying for years now that technology has rendered most government regulations and services USELESS!
I don’t even see the need for labor unions anymore, governments basically do whatever the working-class demands, if the working class becomes more financially educated, they can negotiate their working terms electronically to politicians without the need of a middle man or special interest group. I get it that humans have enjoyed profiting off of the ignorances of others, but the shrinkage of government is either inevitable, or Western nations are headed for bankruptcy.
The Fed’s latest move will send borrowing costs higher | cnbc.com
Interesting times ahead!
