Inflation hitting housing, tuition, and medical services. Is the Fed reinventing another debt based bubble?
Household income is a vital measure of the overall well-being for most Americans. This is why it is important to try to understand why overall household incomes are back to levels last seen in 1995. This is a critical barometer that measures the health of the US middle class. Yet we continually see the argument that inflation is a good thing and since the CPI is registering such a low level of inflation, that the Fed should have a free-ride when it comes to digitally printing our way out of the recession. Yet even a tiny level of inflation is going to hurt when wages are stagnant. That is our current predicament. The one area where Americans spend their most money, housing is becoming more expensive courtesy of the Fed. Inflation is around you if you actually pay attention.
The cost of easy money
It is interesting to note that the big rise in home values has come because of the Fed artificially pushing rates to record low levels. Because of this, home values are trending higher:
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