Price Controls Make Consumer Price Deflation on MAINSTREET Unlikely During Recession; however, Stock Market Prices Could Deflate, Because That’s the INTERNATIONAL market – December 22, 2023

Many people like to conflate Main Street with Wall Street or the domestic economy with the international economy. Because we’re no longer on a GOLD STANDARD, it would be wise not to view the world this way.

The way our current fiat monetary standards are imagined, the domestic economy differs from the international economy. There are a lot of people who want a return to a GOVERNMENT who do not understand the common-sense reason why governments like having the U.S. as the world’s reserve currency.

Private banks all over the world, once given proper licensing, can print U.S. dollars at will as long as they can ATTRACT U.S. capital to their banks. This system allows bad BIG GOVERNMENT ideas not to wreck immediate chaos in the Western world.

Now, I write frequently about the inevitability of austerity measures. Because this monetary system is obviously attracting the WORST types of people into politics, during a time in which the information is out there to put an end to this MADNESS and replace it with a more efficient HARD MONEY system that rewards DOMESTIC innovation.

But in the meantime we’re left with this stupid economy, which for the most part works like this, a politician gets elected by buying votes/promising voters unearned benefits and this fueling of the welfare state equates to all sorts of stupid political decisions for example, the government now wants to control the weather, people actually voted for this stupidity, why? Well, why not, to the average idiot voter the government has unlimited money and can buy unlimited stuff. So why not buy the weather?

 

Buying the either is expensive and requires that the government have more controls over the private sector, if we were on a hard money system or a gold standard system, the GLOBAL economy would have crashed, first of all, the economy wouldn’t even look the way it does now if were on a gold standard because the economy PRIOR to “climate change alarmism” was very INEFFICIENT, and what saved it was OUTSOURCING to China and other undeveloped nations.

This led to PRICE DEFLATION, and if prices are deflating, why wouldn’t the idiot voters imagine more ways for their government to waste money, after all, voting is free, and if you imagine that your government has access to UNLIMITED resources, why not push your government to the limit?

 

Now, in the middle of this is the stock market, which affects Main Street, but not as much if your income is derived from the DOMESTIC economy. Not all the goods you buy are traded on the stock market, and with innovation, energy is actually getting cheaper, meaning that things like PLASTIC are getting cheaper to mass produce.

Currently, the U.S. dollar is the world’s reserve currency, and because the U.S. dollars are being used all over the world, and a lot of countries get to pay their citizens in their own DEPRECIATING national currencies, you start to comprehend the differences between wall street and main street.

We even witnessed the decline in the value of the Euro and the Pound to the U.S. dollar during the last recession that people pretend never happened. That was actually the stock market/forex markets adjusting.

Now, the cost of living has risen in Europe, the U.K., Canada, Australia, and the U.S., but the cost of living around the world hasn’t risen as much in U.S. dollars unless you’re living in the United States.

This is because, in monetary terms, everything revolves around FISCAL policy; with all the sanctions on Russia, for example, Russia has been forced to tighten its belt, meaning that the cost of living in Russia in the U.S. dollar terms is EXTREMELY cheap.

Central Bank Digital Currency

A central bank digital currency is a digital currency issued by a central bank, rather than by a commercial bank. It is also a liability of the central bank and denominated in the sovereign currency, as is the case with physical banknotes and coins.

This means that if Russia stops wasting money bombing Ukraine and takes the lands it wants by fiat, it may actually see a rush of investment, I do believe at this point NATO will think twice about attacking Russia, and because things are so cheap in Russia, it wouldn’t surprise me in the least if in a few years after Russia stops bombing Ukraine that it sees a flood of U.S. dollars.

 

We basically have a private banking monetary system in which everything is based on a ledger. The point of this game is positive cash flow. Now believers in a big government imagine CENTRAL BANK DIGITAL CURRENCIES(CBDCs) as the evolution to this current monetary system, and maybe they’re right, but that’s not something I can predict; what I will say about CBDCs is that they would reward BIG GOVERNMENT spending and Big Government regulations, as well as CENSORSHIP.

a Market economy revolves around innovation and efficiency with capital and resources and CBDCs would be bureaucracy, and the instant CBDCs are proven to be less efficient than cash, you get the same problems they have in India and China, which are talents being WASTED.

 

What is FISCAL policy?

In economics and political science, fiscal policy is the use of government revenue collection and expenditure to influence a country’s economy.

 

 

I see CBDCs the same way I see capital controls; in China, they make sure to separate the Renimbi from the Yuan because if given the CHOICE, the Chinese people would dump their currency for a currency more liberating. In India, I believe they BANNED cash, meaning that they’re basically on the CBDC system right now.

Now, when the Indians and the Chinese are liberated from their countries of origin, they often thrive, but China can’t take over the world because its domestic economy revolves around PRICE CONTROLS/CAPITAL CONTROLS.

Internationally the U.S. is the complete opposite of China; the U.S. wants everyone to use the U.S. dollar; however, domestically, the U.S. has a plethora of price control mechanisms.

Once you see things for what they are, you start to see why sock market prices can deflate, but domestic prices in Western countries might have a more difficult time deflating.

Interesting times ahead!