US Action News

The government is running a $1.6 trillion deficit. Nothing can be done politically to stop this. We are on a runaway train. The main brakes were removed in 1971. The only brake now is that of the bond vigilantes, but the Federal Reserve is the buyer of bonds today, along with Asian central banks. Stockman observed that “the Fed’s QE2 bond purchases have been so massive that it is literally buying Treasury paper in the secondary market almost as fast as new bonds are being issued.”

Since the Fed was created in 1913 the dollar has lost 95% of its value. The Federal Reserve has existed for almost 100 years and it has created depressions, recessions, inflation, and bubbles. This CF&P Foundation video explains the origin of central banking and mentions possible alternatives that will be discussed in subsequent mini-documentaries.

The Fed explicitly said higher prices for energy and other commodities “are putting upward pressure on inflation” and that it would “pay close attention to the evolution of inflation and inflation expectations.”

The lack of a Historical perspective may well prove to be the undoing of our nation. Once a people are divorced from their past they live in the Eternal Now and those who set the agenda can always change now.

The hyperinflation will come from bank bailouts and ongoing Quantitative Easing (QE or money printing) used to keep the financial system from collapse. Calamities in places like Japan will likely accelerate QE. The Fed will have to make up for the loss of Japan as a buyer of our debt.

Food prices soared 3.9 percent last month, the biggest gain since November 1974. Most of that increase was due to a sharp rise in vegetable costs, which increased nearly 50 percent. That was the most in almost a year. Meat and dairy products also rose. – AP

Money creation is never proper economic policy. It does not improve or create wealth. Its purpose is to fool citizens. As such, it is a fraud employed by governments to deceive and steal. If high enough, QE results in societal disruption. At worst, it produces hyperinflation, violence and government overthrow.

Because prices are the transmission mechanism for economic allocation and change, shifting value in the purchasing power of the dollar will reflect inter-country changes. In effect, the dollar is their early warning mechanism. It is their canary.

One-in-three U.S. consumers (32 percent) has already significantly reduced discretionary spending because of the increase of rising gas prices, according to the monthly RBC Consumer Outlook Index.

NIA has been warning its members for two years that the policies of the Federal Reserve and ECB would lead to massive inflation in the prices of food, energy, and clothing, and that is exactly what we are beginning to see right now.