“In the end, deliberate inflation would act like a perverse chemotherapy regimen that ravages the body while leaving the tumor untouched.”
—Peter G. Peterson, Running on Empty
“There is no validity whatever in the idea that any inflation, once accepted, can be confined to moderate proportions.”
—William McChesney Martin
“The first panacea for a mismanaged nation is inflation of the currency; the second is war.”
—Ernest Hemingway
Our magnificent betters spent the greater part of a year whining for the Federal Reserve to cut interest rates and commence “quantitative easing.” What is quantitative easing? This is the Orwellian term for printing money out of thin air, which gives our betters more Monopoly money to enrich themselves, while the hapless proles suffer both the contemporaneous and the ultimate consequences of further currency debasement (i.e., inflation, inflation, inflation).
Contrary to the foolish desires which our betters embrace, the Fed has been trying to tamp down inflation, and doing so by having raised interest rates (i.e., the federal funds rate) and removing from the economy previously created Monopoly money (aka quantitative tightening). Despite the fact inflation is still not under control, the Fed is abandoning both these tools in response to political pressure from, you guessed it, our betters.
You must understand—I beg of you—that our overlords want inflation, and lots of it. On cue, every notable downward blip in the stock markets results in panicky lemmings screaming for an immediate and substantial cut to the Fed’s interest rate. Likewise, housing affordability became a battle cry for lower rates, the fools not realizing current housing prices are unaffordable even if the mortgage interest rate is zero percent—cutting interest rates is likely to fuel further increases in home prices, which is, of course, what the fools want.
Do not be swayed by the crocodile tears shed over housing affordability. Our betters don’t give a damn if the proles can’t afford to buy a house or pay their rent. Stocks and real estate and rents must only rocket upward in the demented minds of these privileged imbeciles. Phantom equity, whether conjured up by Ouija board or lax fiscal policies, is as real to them as if it were actual wealth, fully exchangeable for tangible goods and services, at any time and place.
But it’s not real. No, siree. The balance sheets and financial statements do not remotely reflect a viable claim to wealth. In the aggregate, these claims, represented by oodles of phantom equity, far outstrip the supply of goods and services available today and far into the future. Maybe for eternity. Absent divine intervention, it is impossible for our economy to “grow” fast enough to outrun the headstart made by our deficits, debt, and unfunded liabilities, let alone account for the vast mirage of make-believe wealth.
Nevertheless, childish demands for “free” money (imaginary and otherwise) are regularly put forth in op-eds and pundit interviews, even though, despite the current federal funds rate and its claimed shackling of our “big, beautiful economy,” stocks and real estate are soaring in value far beyond the underlying fundamentals. The increase in the cost of goods and services, as well as in asset valuations, is not under control, nor is the laughable claim that inflation is transitory true, despite contrary claims made by gaslighters, including President Trump who regularly screams for the Fed to lower interest rates.
If we’re going to have an independent central bank, such as the Federal Reserve, one charged with keeping inflation under control, it must be left the hell alone to keep interest rates where they need to be, and they should not turn on the monetary fire hose. A caveat though: The Fed’s goal is two percent inflation, not zero. This is their so-called “targeted inflation rate.” The Fed itself does not want a zero percent inflation rate.
Allow me to present a fact which the financial wizards insist-like-hell is heresy: Zero inflation is a good thing. Don’t allow a glib fool to tell you otherwise. Stable prices allow people, businesses, and the government to gauge how they’re doing financially in the present, and it enables them to make long-term plans with reliable foreknowledge regarding the future costs of goods and services. The fools who desire inflation should want the same thing as the rest of us, yet they don’t.
Here’s another heretical fact: Deflation is often a good thing if it’s the result of technological advancement or increased efficiency. Don’t allow the same glib fools to scare you with the bullshit claim that “deflation is worse than inflation.” It isn’t. Who the fuck doesn’t like lower prices for the things he or she buys?
Oh, the silly financial pranks our betters play on us proles. Targeted inflation is a hardy-har-har one of these. The goal—theirs, not ours—is to “keep” inflation at two percent per year. They swear it’s the just right one of the three beds in the home of the Three Bears, the veritable Goldilocks percent. Of course, this depends on two things: (1) your wages increase by at least two percent each year and (2) the inflation rate, as reported by the government, is truthful and accurate. The latter requires competence and honesty. Hardy-har-har, again.
Targeted inflation is a deliberate debasement of our currency done by our betters. “For our good,” they insist. They promise to keep it at merely two percent per year. Should it spike beyond this magical level of salubrity, they promise to (eventually) work diligently to tamp it back down to two percent, though it might take years.
What about the aggregate inflation in the interim, which occurs while we wait for this tamping down to work its magic? Does the Fed want a dose of deflation to get us down to the point as if it’d been two percent all along, thus undoing the damage done to the proles?
Oh, I think you know the answer to that silly inquiry! Deflation at any time is the boogeyman used to keep us in line; it’s shoved in our faces like the monster under the bed made real and immediately dangerous, much more terrifying than the specter of years of inflation.
And there are madmen who want the targeted Fed rate to be three percent! If granted their reckless wish, four percent and higher are sure to follow. If currency debasement were a miraculous cure for economic ills, the Weimar Republic would not have given rise to Hitler, Mugabe’s Zimbabwe would’ve shined as an economic paradise, and Lionel Shriver would never have found the inspiration for her prophetic book The Mandibles.
(Again) I hope you understand that the problem is our betters demand inflation. This would be the oligarchs and the politicians who do their bidding. Those motherfuckers want inflation, and lots of it. Given the choice of earning two percent profit in an era of zero inflation versus earning twenty percent in an era of ten percent inflation, they’ll choose the latter every damn time. Other than the risk of a revolution, these fuckers don’t care what inflation does to you or the other small folk. They believe they’ve enough kabuki theater to prevent that unseemly end to their fiscal fudgepackery.
Their financial messaging is comically inept. Case in point: As I write this screed, you’ll see multiple articles, often on the same damn day, decrying the high price of housing and how it’s increasingly unaffordable for an increasing percentage of the middle class. On those same days, you’ll see other articles decrying “collapsing” housing prices in certain real estate markets. The government is implored to do something about both scenarios.
Huh?
Our overlords and their politician lackeys swear they want affordable housing, yet they don’t want housing prices to decrease. Which is it that they want? These are two mutually exclusive desires. Do the proles not see this, though it grips the end of their noses?
For those buying a house, collapsing prices means it’s more affordable. For those selling, it means an evaporation of their phantom equity. What is phantom equity as regard to real estate? It means the next place you move to is correspondingly more expensive; therefore, barring geographical arbitrage, you gained not a sou of so-called equity, but instead incur a higher priced new place to live—and higher property taxes, insurance, maintenance costs, etc., to boot. In which case, your phantom equity meant not a damn thing.
Collapse? Believe me, our betters shall do everything in their power—once they’ve scooped up more properties—to blow the real estate balloon back up and keep home prices unaffordable as hell.
The fiscal fudgepackers profit off it at all levels, which makes the inflationary effect on their own wealth a fine-and-dandy trade-off. They use inflation to erode the value of their own debt. They use it to erode the value of any alms they toss the unwashed masses.
They’ll throw every trick at us, but the goal is to prevent lower home prices. The gimmickry is intended to make us believe they care, when they damn well don’t. Every home built by Habitat for Humanity, every government assistance with a mortgage downpayment, every tax deduction, every public housing project, every reverse mortgage, all these are nothing but ruses in furtherance of the oligarchy.
One of the deceits they use is calling home price inflation “appreciation.” This makes the proles believe the increased value of their abodes, which are in reality a major cost center, makes them wealthier. Well, homes have been exploding in “value” since the Covid fiasco, yet do more people feel richer or that a brighter financial future awaits them? Counting the phantom equity in one’s house as tangible wealth is the ultimate self-con.
A particularly cruel trick is the mortgage interest deduction allowed for your income taxes. Your realtor, willfully ignorant friends, and useful idiot pundits insist this is a wonderful thing. It isn’t. You pay dearly for this so-called tax savings. Houses are far dearer in price because of this nefarious distortion to the housing market. Your property taxes are higher. The government deficits and debt are larger due to the lost tax revenue, which fuels inflation on all goods and services. If the wonders of the mortgage tax deduction were true, wouldn’t refinancing your home loan to a higher interest rate be the smarter way to go?
They’ve recently pulled another prank, a proposal to pack fiscal fudge to new levels of absurdity: A newfangled “50-year” mortgage is now put-forth as a solution to high home prices, a way to somehow make it easier for people to buy homes. Hardy-har-har, again and again. The issue is not the mortgage rate or the length of the mortgage! The issue is that home prices are too high and must go down substantially and remain there.
A 50-year mortgage is not a “game changer,” as a dumbass Trump administration official gushed. It’s fucking insane. The math of this is terrifying. For a paltry reduction in a monthly mortgage payment, you extend a standard 30-year loan by two decades and suffer a tremendous increase in the overall interest paid. And if enough fools stampede into the housing market, spurred by this mad offer, the increase demand for homes will, you guessed it, drive home prices higher, which is the intent all along.
We, my friends, find ourselves in a farcical system that is unsustainable muck and mire, crushed by the weight of destructive foolishness.
Allow your humble author to distill down the menagerie of madness: Free speech is shrilly dismissed as a basic human right. Privacy is meekly surrendered. We have suicidal maniacs amongst us who want to destroy our energy sector. Criminals are treated as victims and allowed to reoffend repeatedly. Law abiding citizens are left increasingly unprotected and are rendered disarmed and defenseless. Huge amounts of money are spent on overseas military adventures and forever wars. A large percentage of the population aggressively supports illegal immigration and the cult of transgender ideology. Science and academia are wantonly undermined by DEI, decolonization, indigenization, and other deliberately divisive tactics. We allow students working on worthless degrees to accumulate student debt they can never repay, debt backstopped by our government at the behest of our betters. A much-too-large percentage of working-age adults are not working. Many working-age adults are woefully incompetent as employees; many, in fact, are so feckless that they are unemployable in any capacity. Housing prices going up. Rents going up. Inflated stock prices are detached from reality. Ten of millions of people are on food stamps, Government deficits, debt, and unfunded liabilities race ever upward.
Add to this fetid stew of societal inanities, a government which only serves the oligarchy, Wall Street, and the Military-Industrial Complex, and props up the value of assets at the behest of these betters, the methods used only assuring the next financial crisis is much worse, though the oligarchs shall not just be spared but further enriched, while the poor and middle class further destroyed.
I channel the syntax of Yoda: Depressing as hell it is. Seems hopeless it does.
One of the oligarchs (billionaire Nick Hanauer) warned his gilded brethren about the risk that the unwashed masses may rise up against them, armed with pitchforks, if income inequality is not addressed. He warned, and they did not listen.
But what if things are so bad, that the unwashed cannot afford the pitchforks when the long overdue time to wield them comes?
Oh, there’s much malignant asshattery to overcome. But if somehow the voters shed themselves of childishness and gullibility, if the Woke among us are told to “fuck off” and their vile ideology discarded, and we at long-last elect sensible leaders, perhaps there is hope.
A necessary start is to do the following:
- People must accept that a home is a place to live, not an investment. An increase in home prices is inflation, not appreciation.
- The government must cease taking sides on whether a person owns or rents his or her home. As such, we must eliminate government distortions to the housing market (e.g., mortgage interest tax deductions, money for first-time homebuyers, government-backed mortgages, etc.).
- Stop debasing the currency.
- Force Wall Street to borrow their money like the rest of us.
- Start holding Wall Street to the same rules and consequences as everyone else. For example, the same tax consequences apply, and when they fuck up, they go through bankruptcy court just like the unwashed masses do.
- Do not implement the 50-year mortgage.
These changes shall be painful, very much so at first. Wall Street and our other betters will connive, cajole, and caterwaul like mad in order to maintain the oligarchy and the current flow of corporate welfare that benefits them in the here-and-now, but ultimately seals their own doom.
But without these changes (and many more), we are all doomed. And it already might be too late, since the damage already done is staggering—and there are fools who intend much more if we don’t stop them.
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