By Paul Wallis
Published June 29, 2023
With prices still rising much more than desired, central banks face pressure to hike interest rates further - Copyright GETTY IMAGES NORTH AMERICA/AFP JUSTIN SULLIVAN
The original situation was low rates which led to incredible levels of debt. Interest rate rises were always going to pop this fool’s paradise bubble. Add incredible rises in prices and misinterpreted inflation numbers. You cannot get a clear picture of the realities.
Let’s start with the inflation figures. A smaller-than-expected rise off a very high longer-term base does NOT mean inflation is going down.
Say last year you had a cost that was $100. That cost is now likely to be about $135. The inflation rate goes up slightly last month. Your cost is now say $137.50. You’re not better off, are you?
Oh, but this is just a way of predicting future rises, you say. So what? You’re dealing with a real rate of 37.5% over the year. Feeling better? No, you’re not. …And you won’t. The overall massive losses caused by price rises aren’t going away. The tide is coming in. Wanna buy a bucket and spade?
Then there’s “greedflation”. Massive increases in prices by already extremely profitable companies which never talk about anything but what great numbers they have. …And they’re getting away with it mainly due to that great high school bully expression, “because they can”. The higher the level of deregulation, the more these parasites can suck.
These corporations are also invariably full of debt acquired at low rates. Those debts are getting more expensive. Perhaps Kindly Old Chapter 11 will get them out of debt comfortably. Perhaps not. Either way, your money goes with them. Mismanagement of anything and everything makes some people rich.
It doesn’t make the real economy, you know, the one that buys food and pays bills, rich. These price rises really are insane. People do make money out of them, of course. You can evict a few thousand people and maybe get to play golf with some slightly richer meaningless nobody. People living in cars and cardboard boxes can’t argue.
The Titanic is more likely to dock slightly behind schedule in New York with all passengers than this mess to float. The current cycle of “sociopathflation”* can’t be fixed by muttering about passing stats. Poverty is a leading cause of death in America.
*Sociopathflation – Noun – Economic chaos caused by absurdly high price rises inflicted by mindless executive peasants.
Since the nutcases got involved, capitalism doesn’t work now. Not that it worked all that well to start with, but people were reasonably prosperous back in the 60s and 70s. It’s been all downhill since. Just about all the essentials have been sabotaged. Health, education, housing, food, and water are all fundamentally screwed.
Add to this the global abuse of revenue. Tax evasion costs trillions. You can’t provide services with money you don’t have. You have to borrow. Then some insect tells you you’re borrowing too much. What choice do you have? Cut back on services people need.
Meanwhile, the vermin are making big money. If you try to fund enforcement, they block you from funding or try to block you.
Options available:Equally huge tax rises for the worst-offending sectors. They’ll try to evade the taxes. Then you can wipe them out.
Indefinite price freeze. They can’t argue. They’ve got all those “great numbers”, right? They have to reduce debt, too.
Basic business economic training to educate people to know how utterly irresponsible the financial sector usually is on any given day.
Debt management training.
Any house brick could tell you these price rises are just theft. To hell with them.
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