Is it starting to look like hyperinflation is all but inevitable?? (either that OR super high taxes)?
The government will have to borrow nearly 50 cents for every dollar it spends this year, exploding the record federal deficit past .8 trillion under new White House estimates.
Budget office figures released Monday would add billion to the 2009 red ink — increasing it to more than four times last year’s all-time high as the government hands out billions more than expected for people who have lost jobs and takes in less tax revenue from people and companies making less money.
The unprecedented deficit figures flow from the deep recession, the Wall Street bailout and the cost of President Barack Obama’s economic stimulus bill — as well as a seemingly embedded structural imbalance between what the government spends and what it takes in.
http://finance.yahoo.com/news/White-House-Budget-deficit-to-apf-15199183.html?.v=8
Government spending is paid for 1 of 2 ways:
1)monetizing debt ("printing" money) which leads to more inflation (=each dollar bill has less purchasing power)
2)higher taxes & new hidden taxes (carbon taxes, etc)
Well since taxes won’t even begin to cover TRILLIONS in new spending, option one is being used to the max.
Now I want you to watch this 60 minutes interview from 2007. In it, the former comptroller general (nation’s top accountant) says the United States government is bankrupt and that if it were a company if would have failed by now. He also says that at CURRENT spending levels (2007 levels) the U.S. govt. could only afford to pay social security and some medicaid by 2040.
http://www.youtube.com/watch?v=OS2fI2p9iVs&feature=related
Since then we have passed trillion in bailouts, nearly trillion dollars in "stimulus", and Obama has proposed AN ADDITIONAL .5 trillion budget.
Now if the comptroller general thought the U.S. couldn’t afford to pay for Bush’s prescription drug bill (from many years back), HOW is Obama going to pay for all this new spending???
He’ll either have to raise taxes to levels undreamed or hyperinflate the dollar attempting to monetize more debt.
boss h……………probably higher than that.
Everybody knows we’re fucked. It’s just some don’t want to admit it.
"Then I say, the earth belongs to each of these generations during its course, fully and in its own right. The second generation receives it clear of the debts and incumbrances of the first, the third of the second, and so on. For if the first could charge it with a debt, then the earth would belong to the dead and not to the living generation. Then, no generation can contract debts greater than may be paid during the course of its own existence."
“Paper is poverty,… it is only the ghost of money, and not money itself.”
“That paper money has some advantages is admitted. But that its abuses also are inevitable and, by breaking up the measure of value, makes a lottery of all private property, cannot be denied.”
“Private fortunes, in the present state of our circulation, are at the mercy of those self-created money lenders, and are prostrated by the floods of nominal money with which their avarice deluges us.”
August 26th, 2010 at 3:35 pmInflation is good right now. The prices of goods are low and if they are increased people will make more money.
August 26th, 2010 at 3:35 pmyou mean like fuel hitting $4 a gallon?
August 26th, 2010 at 3:35 pmIts inevitable
August 26th, 2010 at 3:35 pmSorry but I have to disagree with you. No one is getting taxed yet. 95% of the American people got a tax cut, and in 2010 5% of the Riches people will have to pay their fair share of taxes.
And real inflation set in back in the summer of 2005 when my food bills doubled
August 26th, 2010 at 3:35 pmBoth more than likely and it looks like big oil is making more $$$ per gallon again…dino
August 26th, 2010 at 3:35 pmIt is inflation, and eventual collapse of US monetary system, which of course will cause WW III.
Raising taxes will not help: it is impossible to collect more than $3 trillion in revenues, because higher taxes simply cause GDP to shrink and increase tax avoidance.
August 26th, 2010 at 3:35 pmBoth.
Inflation and a tax on wealth.
We are turning into pre-industrial Holland: taxes on everything including the air we breath (cap and trade).
August 26th, 2010 at 3:35 pmPeter Schiff who was the only person to predict the housing collapse…
Predicts hyperinflation.
Buy gold…buy a gun.
August 26th, 2010 at 3:35 pmif the retired people and people on fixed incomes could keep up with
hyper inflation then it would be a good deal
but if it ends up wiping out the middle classs? the it is not a good idea
August 26th, 2010 at 3:35 pmNo. Possible yes–but neither hyperinflation nor major tax hikes are inevitable.
But if the cons don’t like it, tough. If either happens, well-they should have thought of the consequences before they wrecked the economy.
August 26th, 2010 at 3:35 pmI think it’s very likely we’ll see high single digit or low double digit inflation. Quite frankly, I think it would be a helpful thing at this point what with the housing market decline and tough real estate market.
I doubt we’ll see anything close to hyper inflation.
August 26th, 2010 at 3:35 pmProbably is inevitable. Think about this. 0bama said he wouldn’t raise taxes except on those making iver $250K/year. If we have hyperinflation, most people will be making over $250K.
August 26th, 2010 at 3:35 pmBOTH are going to happen and I hope people start to call their Democrat Congress and Democrat Senators and ask them if this is what they had in mind by voting for all of Obama’s Spending.
August 26th, 2010 at 3:35 pmYep it is pretty much inevitable
It is the wedge the traitors need to form the North American Union no one wants
Full steam ahead said the Captain of the Titanic
Aye aye sir full steam ahead sir
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What a bunch of compliant f—ers we really are
August 26th, 2010 at 3:35 pmYou are totally right but I can not believe the first answer you got, the person just opens mouth and inserts foot. I wonder how he would explain inflation being good for the poor.
August 26th, 2010 at 3:35 pmObviously, Bernanke intends to continue to throw our prosperity from the Helicopter with his endless operation of the Printing Press.
In the best case scenario, America ends up with a repeat of the 1970s. More likely, we’re looking at a situation akin to the Weimar Republic. Worst case scenario, we turn into Zimbabwe.
However, the good news about this is that when the paychecks stop arriving or lose all their value, most government bureaucrats will quit. The government will collapse, doubtlessly providing a great opportunity for the establishment of the libertarian society.
We should not regard hyperinflation as something to be feared. We should welcome hyperinflation because it will bring the end of tyranny and the fulfillment of the American Revolution.
August 26th, 2010 at 3:35 pmInflation is coming. We already had an issue with a weak dollar, now we are printing a whole bunch of money. Printing an endless amount of money is a horrible idea.
August 26th, 2010 at 3:35 pmGive this question a rest…
Hyperinflation!
Are you kidding?
The US inflation rate for the past 5 months has been 1% and less.
When do you predict this hyperinflation to hit?
August 26th, 2010 at 3:35 pmBoth in my opinion.
You see in the last year we have monetized over 1 trillion USD. That more than doubled the worlds supply in circulation. We monetized that much because no one would buy it.
The fact that the dollar has not crashed is because other currency crashed instead and people started putting more and more faith in the USD rather than their own currency.
Worst case scenario we continue monetizing debt because no one will buy it rather than reducing spending. This will result in hyperinflation which can’t be countered by the FED because its interest rate is already as low as it can be so the only way to recoup the value is to take bills from circulation and the only way the government can do that is reduce spending to surplus levels or tax the living crap out of the people.
So whats going to happen? Well we are already looking at an 1.8 trillion USD deficit this year alone. We monetized 1 trillion USD in the last year because we couldn’t get all of our debt purchased and only about half the TARP is even spent so that means that we monetized more that our entire deficit of 410 billion in 2008 plus the 350 billion in TARP spending. We would need a budget surplus of some 240 billion just to avoid monetizing debt.
So our deficit last year was way less including 350 billion in TARP spending how much are we going to monetize this year with the other 350 billion on top of the 1.8 trillion in deficit spending? Welcome to hyper inflation and the ensuing taxation from hell brought on by the power hungry idiots controlling our country.
In the end the people with lots of money will have even more and the people with enough to be happy will have even less and that money will be virtually worthless.
August 26th, 2010 at 3:35 pmGAS IS ALREADY STARTING TO RISE! Its part of the market, and it will react eventually to this mess.
August 26th, 2010 at 3:35 pmi dont understand why we pick and choose our socialism. we regulate electicity and gas yet we do nothing about gasoline and deisel? If we are going to nationalize healthcare, reitirement, and ou rbanks, we need to do our fuel as well. damn one, damn then all.
Yes. The amount of fiscal stimulus being aplied may well turn out to have been excessive, and that would lead to inflation. Economic conditions are not that different than they were in the 70s. Oil prices recently hit all-time highs, foriegn competition is taking away American jobs, monetary and fiscal policy is extremely loose. The stage is set for a nother bout of stagflation, with low economic growth, high unemployment, and high inflation.
As someone who remembers the 70s, I can assure you, it will suck.
High taxes won’t likely stop it, either. Tightening of the money suply is what’s needed to fight inflation, and that’s on the Fed.
August 26th, 2010 at 3:35 pmIt’s going to be BOTH.
August 26th, 2010 at 3:35 pm