When I was a young lieutenant in Berlin, I got an interesting call one evening. A high school friend who was now a junior executive in the hometown bank where I had my college loans (his father was the bank’s hereditary president, so his being on the executive track had less to do with his ability than his chromosomes) on the crackling line. He wasn’t calling out of the blue to catch up; he called to try to convince me to pay off my student loans early. You see, inflation was rocketing along at 13%, and my loans were a demure and innocent 2-point-something APR, and it was worth their time to call me to offer me some “forgiveness” if I would just accelerate my payments. Even as a dumbsh** infantryman, I was smart enough to figure out that holding onto my loans for as long as possible and letting inflation work on them was a damned good course of action, so I declined the kind offer.
What does this have to do with anything? Well, boys, girls, and sexually undefined things, we’re entering this territory anew.
Prices rose 6.2 percent in October compared with a year ago, the largest annual increase in 30 years, as inflation continues to weigh on the economy and is lasting longer than policymakers at the Fed and White House anticipated heading into the end of the year.
Data released Wednesday by the Bureau of Labor Statistics showed that prices rose 0.9 percent in October compared with September, a higher-than-expected jump, tying June for the biggest one-month increase in prices this year.
Forecasters expected a surge in October’s inflation data, in large part because of soaring gas and energy prices, plus ongoing supply chain backlogs in the used-car market. The energy index rose 4.8 percent in October compared to the month before, as the gasoline index increased 6.1 percent.
Yet, inflation expanded to other categories, increasing throughout the economy, with the BLS noting “broad-based” higher prices for energy, shelter, food, used cars and trucks and new vehicles among the larger contributors.
“Along with shelter, used cars and trucks, and new vehicles, the indexes for medical care, for household furnishing and operations, and for recreation all increased in October,” the report read.
(For earlier coverage on this topic read The Latest Inflation Numbers Will Have You Punching Walls and Voting Against Democrats.)
The 16¢ the Biden bunch was crowing that it saved you on the Fourth of July has led to a prediction, reported on in the New York Times, no less, that this Thanksgiving will be the most expensive since the Indians gifteYear’sachusetts to the Pilgrims. From This Year’s Thanksgiving Feast Will Wallop the Wallet:
Thanksgiving 2021 could be the most expensive meal in the history of the holiday.
Turkey is more expensive largely because the price of corn, which most commercial turkeys feed on, more than doubled in some parts of the country from July 2020 to July 2021. Whole frozen birds between eight and 16 pounds already cost 25 cents a pound more than they did a year ago, according to the weekly Department of Agriculture turkey report released on Friday.
What is more troubling than the annualized 6.2% increase in inflation is the 0.9% October jump. That increase is more than double the 0.4% increase logged in September. Should this trend continue, and there is no reason to suppose it will not, it portends an annual inflation rate north of 10% in the next year.
There is a lot of profoundly stupid commentary on the subject being pushed into the national conversation by Democrat operatives and the fluffers of said operatives. It goes like this, “We were in the throes of a pandemic last year. This is the consequence of the economy roaring back.” No. It really isn’t. If the economy were “roaring back,” inflation would be driven by increases in productivity and wages. That isn’t the case.
After adjusting for today’s new inflation numbers, average hourly wages fell 1.2% from Oct 2020 to Oct 2021. Change in real average hourly earnings combined with a decrease of 0.3% in average workweek resulted in a 1.6% decrease in real avg weekly earnings https://t.co/6ybYIwIHBm
— Catherine Rampell (@crampell) November 10, 2021
Inflation is too much money seeking Too few goods. The money part of the equation is very easy to demonstrate.
pretty easy to explain pic.twitter.com/I6W8pjB4Ug
— streiff (@streiffredstate) November 10, 2021
What we are seeing is the kind of inflation that made the Weimar Republic into an economic powerhouse.
If this keeps up, and with the Democrats attempting to pump a few trillion dollars into “infrastructure” and direct payments to people, there is every indication that it will; inflation is going to demolish the American middle class.
As wages stagnate and work hours are reduced, more and more people are going to have to hold down at least two jobs to maintain their current standard of living. With food, energy, and gasoline costs out of control; families must spend more of their reduced income on necessities. To make matters worse, the Biden bunch seems to be eager to stoke the fire rather than dampen it (READ: Watch: Energy Sec Laughs Her Head off When won’t About Rising Gas Prices and Biden Considers Killing Another US Pipeline as Oil Crisis Continues).
Inflation doesn’t just have a daily impact. It can change how people live. That 401k account that you’d hope would let you check out of the rat race before you developed an insatiable craving for soft-serve Ice cream? Well, it won’t be there for you. As loan interest rates begin to align with the SpaceX quality inflation, you will find that your home is worth a lot less than you are paying for it because of the lack of potential buyers. If you have an adjustable-rate mortgage, you might have an unpleasant surprise in that letter you just got from your lender. Are you running a high balance on your credit card? You aren’t going to like what that looks like when chronic double-digit inflation kicks in.
Unfortunately, unlike the 1980s, we don’t have a Paul Volcker at the helm of the Fed who is willing to take the political heat to save America’s middle class from destruction. We also don’t have a Ronald Reagan in the wings to lead us out of this or any indication that Congress, as a whole, understands what is about to happen to us all.
What is worse, given a lot of other things happening, it is getting harder and harder to believe that this is just the result of some idiots acting out—more on that in the future.