What, Me Worry?

The “Wall Street is starting to get antsier about inflation” reads the YAHOO! News headline.  “Investors are more worried about inflation than the Fed seems to be…”

Then, as the inflation numbers are coming in huge — at the same time along comes some genius at MSNBC to inform us that all this inflation isn’t a bad thing, after all.  In fact, a Fox News accounts of this balderdash headlines it this way: “MSNBC columnist says current inflation crisis is actually a ‘good thing.’”

What, me worry about inflation? the columnist seemed to ask.  

It was simply MAD!

It was not a swell time for this particular set of opinions to appear because on the same day the Bureau of Labor Statistics reported that the Producer Price Index was up 8.6 over the twelve months ending in October.  

And that is uncomfortably close to double-digit inflation.

According to MSNBC’s own headline their columnist James Surowiecki, the MSNBC columnist, explains “How Covid became the unlikely hero of our inflation crisis.”

Enough of the battling headlines.  Surowiecki explains “Historically, recessions have left Americans poorer, not better off. But the Covid recession was different. As people shifted their habits drastically in response to the pandemic, they spent much less and saved more. Even though millions of Americans lost their jobs, enhanced unemployment benefits and stimulus payments left many of them better off, not worse. And the stock market, after initially falling, boomed.

Employment benefits and stimulus payments left much better off?  And the stock market boomed?  Well, congratulations to the monied classes.  Never mind the millions who lost their jobs.  Or the family businesses that closed taking the savings of perhaps generations with it.  MSNBC sees it differently.  

We barely have the patience to explain that the money for employee benefits and stimulus payments actually comes from somewhere.  The governments that write those benefit and payment checks don’t create any wealth.  So, their checks must be covered by someone else.  From people who are productive.  It will come from taxation, borrowing (that must be paid back), or by destroying the purchasing power of the currency.

Or as Milton Friedman said, “There ain’t no such thing as a free lunch.”  Stated differently, what distinguishes a responsible commentator on economic things from an MSNBC or an irresponsible one (do we repeat ourselves?) is that the responsible ones know that are two sides to the balance sheet.  Of course, the people who receive “free” money like it.  Except that it is not really free.  And inflation, so benign as it scatters its “blessings,” actually destroys savings and frays the social fabric.  It cripples capital formation which is the engine of future growth and polarizes the poles of the wealthy and the impoverished.  It undermines people’s natural propensity to prepare for the future and collapses entire nations.  

As for Mr. Surowiecki, he is concerned that TV news stories about rising prices are “likely to confuse and frighten viewers rather than enlighten them.”

Right. It’s funny that in enlightening people himself, he doesn’t say a word about the trillions in fiat money the Fed has “legally counterfeited” lately.  Quite an oversight.

The public sees the prices at the grocery store and at the gas pump Mr. Surowieki.  They are not confused about the damage inflation is doing to their pocketbooks, their savings, their household budgets!

The only thing confusing is why hack commentators try to run interference for the bunglers in Washington and soft-pedal the news of their malperformance.  

As long as people like Surowiecki, apologists for the Deep State Money Manipulators, are prominent in the public debate, buy gold and silver.

With both hands!