by David Haggith, Gold Seek:
Janet Yellen figured out that Covid stimulus may have contributed “a little bit” to inflation. What a chipmunk! With dim-bulb illumination like that, it’s no wonder she finds it “hard to see how the math [of DOGE] works.” Is it hard to see how government efficiency helps reduce the budget deficit, Dear Yanet?
Yanet thinks that it was almost exclusively shortages of goods due to the supply-line crisis that caused inflation after the Covid lockdowns. Apparently, as Treasurer, she doesn’t know the most elementary formula for inflation: too much money chasing too few goods. She gets the last part because none of that can be blamed on her as Treasurer. She conveniently forgets—or was just never well educated in the fundamentals of economics—that it is when you have an over-supply of money confronting an undersupply of goods and services that inflation really catches fire because people will deploy the surplus money to chase after the goods they need or want.
TRUTH LIVES on at https://sgtreport.tv/
Ah, well, Yanet, back to school for you.
As for her comment about DOGE, sure it is going to take more than efficiency majors to balance the budget—a lot more—yet every billion dollars helps. Save enough of them, and pretty soon you’re talking real money. Regardless, we must balance it with some major changes because the debt is starting to consume everything like a black hole.
As for whether or not Trump and the DOGE Brothers, Elon and Viv, are going to accomplish that, I agree with Bill Bonner:
Many readers think we are too ‘negative’ or that we may be afflicted with Trump Derangement Syndrome, blinded to the good the man might do.
Maybe. Our bartender tells us the Trump Derangement Syndrome is probably in remission. And, we’ll put in a special Suicide Prevention Hotline here in the office, just in case.
But there is nothing in Mr. Trump’s policy proposals… or his stray comments… to make us think he will do anything very different from the last time he was president. Or that tariffs will work now, when they’ve failed so many times in the past. Or that tax cuts will do anything except increase the deficit.
It’s a good article. I recommend reading it.
Why we have to conquer the deficit NOW
Yanet Jellin’ does make one accurate comment:
“Interest rate increases have led to higher costs of servicing the outstanding debt. That’s one factor that’s been involved,” she said.
But she made it in an effort to evade the responsibility of fiscal policy under Biden. Bidenomics was an accelerant to the inflation caused by the Treasury’s work as an accomplice of the Fed to create a lot more money to fund Bidenomics as well as to fund all the stimulus and corporate bailout money that kept surplus money flowing into the hands of ordinary people (and megacorps) who, by government mandate, were no longer making anything or providing services, creating that shortage of goods and services.
From there, it was the high inflation that caused the interest rate increases that have as Gramma Jellin’ jives, “led to higher costs of servicing the debt.” And that is the little bomb we just saw go off recently in the bond market when news hit the press that all of the members of the Fed at their last FOMC meeting were concerned that INFLATION IS BACK! (Now, who coulda seen that coming?) That caused the interest on the national debt to spike hard.
“Almost all participants judged that upside risks to the inflation outlook had increased,” the minutes said. “As reasons for this judgment, participants cited recent stronger-than-expected readings on inflation and the likely effects of potential changes in trade and immigration policy.”
In other words, the return of inflation was already in the making since it started to rise last year at the first hint that the Fed would back down on its interest hikes. The members of the Fed want, of course, to shift the blame to Trump’s tariffs, and I’ve no doubt those will make inflation worse, maybe even much worse; but inflation was already getting worse as seen in those recent readings they acknowledged, and it is set to ramp up more still with no additional tariffs in place so far. Tariffs might become gasoline on that fire, but the Fed has failed and will be forced back to the fight either way. Those “stronger-than-expected” readings aren’t going away.
