Via Greg Hunter’s USAWatchdog.com,
Economist John Williams, founder of ShadowStats.com, says the Federal Reserve has painted itself into such a tight corner with the economy it really has only two choices. Williams says it comes down to “Inflation or Implosion.”
What would happen to the financial system if the Fed stopped printing massive amounts of money for stimulus and debt service? Williams explains,
“You could see financial implosion by preventing liquidity being put into the system. The system needs liquidity (freshly created dollars) to function. Without that liquidity, you would see more of an economic implosion than you have already seen. In fact, I will contend that the headline pandemic numbers have actually been a lot worse than they have been reporting. It also means we are not recovering quite as quickly. The Fed needs to keep the banking system afloat. They want to keep the economy afloat. All that requires a tremendous influx of liquidity in these difficult times.”
So, is the choice inflation or implosion? Williams says, “That’s the choice, and I think we are going to have a combination of both of them...”
“ I think we are eventually headed into a hyperinflationary economic collapse. It’s not that we haven’t been in an economic collapse already, we are coming back some now. . . . The Fed has been creating money at a pace that has never been seen before. You are basically up 75% (in money creation) year over year. This is unprecedented. Normally, it might be up 1% or 2% year over year. The exploding money supply will lead to inflation. I am not saying we are going to get to 75% inflation—yet, but you are getting up to the 4% or 5% range, and you are soon going to be seeing 10% range year over year. . . . The Fed has lost control of inflation.”
And remember, when the Fed has to admit the official inflation rate is 10%, John Williams says, “When they have to admit the inflation rate is 10%, my number is going to be up to around 15% or higher. My number rides on top of their number.”
Right now, the Shadowstat.com inflation rate is above 11%. That’s if it were calculated the way it was before 1980 when the government started using accounting gimmicks to make inflation look less than it really is. The Shadowstats.com number cuts out all the accounting gimmicks and is the true inflation rate that most Americans are seeing right now, not the “official” 4.25% recently reported.
Williams says the best way to fight the inflation that is already here is to buy tangible assets. Williams says,
“Canned food is a tangible asset, and you can use it for barter if you have to. . . . Physical gold and silver is the best way to protect your buying power over time.”
Gold may be a bit expensive for most, but silver is still relatively cheap. Williams says, “Everything is going to go up in price.”
When will the worst inflation be hitting America? Williams predicts,
“I am looking down the road, and in early 2022, I am looking for something close to a hyperinflationary circumstance and effectively a collapsed economy.”
Join Greg Hunter of USAWatchdog.com as he goes One-on-One with John Williams, founder of ShadowStats.com.
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I like to listen to Greg Hunter’s interviews but he is dull to watch.
I found watching this video with the sound muted while listening to the interview about coming inflation, hyperinflation and collapse brought it all into perspective. If you listen to the discussion about inflationary concerns while watching the confused lost souls in Philadephia’s worst drug district wandering through their miserable days. The average addict spends $200 a day. The inflation genie has hit the 30 Blocks and the Squalor has gone exponential.
I found several really good videos about the increasing homeless and drug problems in Philadephia for others suffering from a lack of 30 Blocks. I really am serious about listening intently to the discussion about the obvious collapse of our economy while watching the image of a society in freefall collapse on the streets of Philadelphia.
What is not obviously in common between the two issues?
Perhaps the velocity of money doesn’t matter any more? Many of these addicts are military veterans, using their disability stipend to fund a terrible existence.
A couple of years ago, I tried to point out the strange increase in disability awards by the VA system … I think more than half of all young people exiting the service leave with a disability pension of at least 20%, which is the minimum to qualify for Vocational Rehabilitation under a very generous GI Bill. Funding for it is via unfunded liabilities that the government lies to all of us about.
At the time, I was looking at it from a point of view that has changed drastically over the past three years.
I think I read enough of Oliver North’s biography to grasp that insiders with access to the big money pot always know how to get their share of the vig. I got very interested in that topic because I truly believe government involvement in the drug trade began in a little place called Mena, Arkansas around the time I joined the USAF in 1984 because I was on a Dog and Pony show at Andrews AFB on an AWACS plane and met William Sessions, director of the FBI at the time and answered a couple of direct and intelligent questions about how the radar receiver detects aircraft moving over water and I explained the concept of land mass blanking and relative movement… the AWACS plane at 30K feet is relatively stable in its orbit compared to a small craft moving at 80 knots over the water or coastline. By feeding the E-3 (AWACS) airspeed into the equation, the radar return filters any land clutter out, as well as finding the needle in the haystack below.
At least that was how we advertised it. And, yes, I did fly on a few missions where we supposedly directed Coast Guard intercepts of significant drug drops. (I have a citation and a ribbon!)
After watching several of these videos about Kensington and Allegheny (I searched for Squalor and Philadephia and ended up with several good updates on sights from Admin’s old detour to work.)
Oops, I didn’t finish that thought.
What I wanted to say was that listening to the interview and contemplating the wretched condition of the inner cities, especially the streets of Philadelphia for TBPers with a keening for the old detour stories, well, it hit home that the society is collapsing.
Just look at these people!
But for the grace of God…give thanks.
There is a direct correlation between cities going to hell, and democrats in government. This is what liberalism creates. Government is the problem, never the solution.
Been following JW shadowstats since the 07/08 crisis. Never thought the banksters could keep this ship afloat for this long. What a voyage the last 13 years has been. Lots of icebergs and shallow waters ahead. If your not already on a life raft, it might be time to start meandring towards one.
Less – ‘19 was the time for meandering. In 2021, you should be running for your life.
So glad Biden and his cronies will be the bag holders when this happens.
I’m not a Trump accolade but IMO, Trump saw the economic crash coming. While he put on a show of rallies he did zero in efforts to halt the fraudulent stealing of the election. IMO, he didn’t want to be the guy holding the bag when the collapse comes. He’ll step back, let the demoncraps trash the economy faster and then he’ll step back into the ring as the saviour of amurika. Just what I see coming…
Then all the Trump supporters will re-engage the Trump playing 8D level chess and Trump will do no wrong and media will lose their heads again, obviously. Everything back to normal, except the alien invasion oh my…
Dems and their PR firms (major media) will make sure everyone knows the collapse is the fault of Trump and the repubs.
The late Richard Russell said it this way: “Inflate or Die”. The problem is that there is not enough currency in existence to pay off debt, if they stop printing/inflating, then Implosion or Death.
A whole bunch of Gentiles are really wrong.
Dude, stop with the fear mongering. The Rosensbergs got this. #TrustTheTribe They create the money, therefore they should know something about inflation.
“The fiscal policy and the short term nature of the stimulus has just accentuated the volatility in the data. So I actually believe that come the fall, we will start to see the reopenings having a positive impact on aggregate supply at a time when we’re gonna see fiscal withdrawal having a downward impact on demand. And so a lot of the inflation we’re seeing today is going to reverse course I expect either by late summer or early fall.”
https://www.zerohedge.com/markets/david-rosenberg-whole-bunch-people-are-really-really-wrong-about-inflation
The Fed hasn’t lost control of anything. They’ve been engineering the booms and the busts ever since the Federal Reserve Act was signed into law in 1913.
“singed” into law is probably close since it was a deal with the devil.
You are correct sir! The lenders and buyers of last resort are getting ready to bring the world to it’s knees…for their masters…and the it will not be because they lost control…but because they are following orders.
WHO REALLY CONTROLS THE WORLD?
By Dr. MUJAHID KAMRAN
A decade old but still a good basic primer for those just opening their eyes…
I am reliably advised that hyperinflation can’t happen in USA because the US$ is a reserve currency. For hyperinflation to occur you have to have an alternative circulating currency like in Venezuela or Zimbabwe where they use the US$, or South African Rand etc.
In a total USA collapse perhaps PMs become a currency or as John says, canned food, cigarettes (as in POW camps) – who knows? – I don’t. But in this case I guess the Fed would think of something?
Bitcoin. It cuts the Gov. out of the equation. It has a set-limited amount that can exist, unlike the dollar that is being printed to infinity. Gold and silver and small items that you take for granted will be useful.
Yep, Yahsure, it certainly could work – nobody knows yet but I guess time will tell as we descend into the abyss.
Economics 101: Hyperinflation> Hyperinflation is inflation at the rate of 50% or more per month. It is not a monetary phenomena, it is a result of restricted supply in which goods are in such short supply, people will literally pay anything to get them.
Economics 102:
“Hyperinflation can occur in times of war and economic turmoil in the underlying production economy, in conjunction with a central bank printing an excessive amount of money.”
https://www.investopedia.com/terms/h/hyperinflation.asp
🙂 Actually Jdog it is all these things and more. Economics is more an art than science IMHO.
Dealing strictly in the real world, and not delving into hypothesis about what could possibly happen in the minds of men, Hyperinflation has only ever happened in cases where supply of goods were severely restricted. The foremost example being Germany after WW1 when France and England stole all Germany’s production. It goes without saying that once this process begins, the government is obliged to meet the demand for money by ramping up printing to meet demand. That does not equate to the printing being a cause of the Hyperinflation, it is in fact the result. The actual cause is the restriction of goods. You can tell this is true by looking at the results of the opposite. The government can print all the money it wants without creating Hyperinflation because the equation lacks the mechanism to get the money into circulation. There is simply no demand. Supply is always worthless without demand, and demand must always come before supply can be used. I hope this clears up this issue.
Not sure that I agree entirely – see my reply to The Assegai below where I quote from an economist who supplied the answer. It’s beyond my simple Austrian economic mind!
Peter, you have to differentiate between cause and effect. Money printing in itself is not inflationary, because
it needs a way
to make it off the books of the Fed and into the hands of consumers. Usually that mechanism is credit, every time you use credit you create money out of thin air, the Central bank simply fills the order.
The other way is to restrict demand so that people panic and are willing to pay whatever the price to get what they think they need.
Now helicopter money is surely inflationary, and that is what we are seeing in the US today driving prices, but it is in conjunction with artificial shortages being manufactured by corporate interests.
In order for hyperinflation to happen, you need a severe disruption in the supply of goods, it is the only phenomena that will panic people into paying 50% more for everything month after month..
Do not confuse regular inflation with hyperinflation, they are two very different things…
This is excellent and well explained, thank you Jdog, and agree with all you say. Thank you for going to the trouble to educate this poor old chap and hoping that you will at least be able to handle the coming crisis, which as you say, is being engineered.
Not so certain about that AP. Fiat currency, reserve or not, is a CONfidence game, once the confidence is lost it’s over. To this point in time, the US military has maintained the reserve status of the USD/FRN, but I don’t think they will be able to maintain that if enough nations say we want out of the dollar. At that point, the trillions of dollars held abroad flood back to the US purchasing anything and everything just to dump their dollars, and the dollars held in the US compete with the incoming dollars, in other words hyperinflation.
OK, yes agreed The Assegai, but what we will use as an alternative to the dollar is yet to be determined. I don’t think that Bitcoin will fill the bill because like gold, it has limited supply and as demand for money increases then prices will inevitably increase – hence the inflation, hyper or not, which you mention. So we are in the same book just maybe not yet on the same page 🙂
All a guess on my part, and subject to change I readily admit.
I think that what is going on is a big game, while we may not know, the planners/gammers have something in the works. Obviously they want to get global, but it will probably need to start nationally; this is where CBDC (Central Bank Digital Currency) will start. From their perspective, digital is a must for control; social scoring, direct deposit and withdrawal and negative interest rates. The term thrown around in the US is FEDCoin. The Plandemic was the beginning of this by starting the fear of virus contaminated currency. Hegelian Dialectic with digital currency being the solution.
Gold/Silver may be what you and I work with on the side, but there is no way the planners are going to establish it as the main means of transaction. We will never get to a ‘gold standard’, but I think that ‘they’ will allow gold to re-value and use it as some type of backing for their currency. That’s why China probably has 30 MT.
Something to keep an eye on is the WEFs Cyber Polygon coming up. We know that their Event 201 was an exact simulation of the Plandemic, what will Cyber Polygon bring.
https://www.weforum.org/videos/a-cyber-attack-with-covid-like-characteristics
Excellent analysis The Assegai and thank you a sound indication of the FedCoin which I agree. A SUPER BRILLIANT economic adviser sent this to me:
“The Reserve status of the US Dollar is inconsequential. That is all about international trade settlement — in other words US Dollars OUTSIDE America. Inside America, for Currency Collapse to occur (Hyperinflation), you need an alternative currency INSIDE America, that is generally accepted (by almost everyone), for everyone to switch to in order to pay their bills, buy their groceries etc etc.
I have explained this before. When a Hyperinflation occurs, there is ALWAYS a Hyper-deflation in the alternative currency. The price of EVERYTHING collapses in relation to the alternative currency. This is why Hyperinflations don’t last long. The Govt usually wakes up and issues a new currency at that point (!) and confiscates the alternative at the point of a gun. That is what Hjalmar Horace Greeley Schacht did in Germany in the Weimar Republic — and it worked (!)
https://en.wikipedia.org/wiki/Hjalmar_Schacht#Rise_to_president_of_the_Reichsbank
Germany has had 6 currencies in the last 100 years and is the most powerful economy in Europe!
Please feel free to pick the worms out of this – it’s beyond my pay grade.
Inflation is now either approaching, or all ready at double digit levels. This is a very important level because at this level, large companies must, in order to prevent huge loses, begin to “front run” inflation. This means they must begin to raise prices in advance, and in anticipation of actual cost increases do to the time lags in the supply chain.
Once frontrunning begins, the Fed can no longer control inflation without drastic moves in the interest rates.
The last time this happened, both inflation and the interest rates to fight it, went over 17%.
The real problem is this time, we have irresponsibly high Federal Debt. While the Federal Debt never really needs to be paid, it does need to be serviced. The interest payments to the people who have purchased Treasuries have to be paid. If the costs to service the Federal Debt increase substantially, the Federal Government will have to increase it’s revenue accordingly. That means higher taxes. Much, higher taxes.
In short, what is happening now, will result in a Federal budget crisis, in which we will probably see tax hikes, and cuts in government spending on a scale not seen ever before.
I don’t think you appreciate how few hands control these corporations.
If interest rates increase as they did in Volker’s day then all the zombie companies and many more will go out of business before the government can take any action?
This is true, but zombie companies should go out of business. Do not confuse the government, with the Fed, the Fed is not the government, and vice versa. The Fed is only concerned with the interests of it’s shareholders, and it’s shareholders are it’s member banks.
I expect there is so much power in so few hands that they can keep this shitshow going without hyper-inflation for the foreseeable future. I would predict civil unrest before fiat collapse. And that is a ways off too.
I paid my life insurance premium today. Well past the two year exclusion for suicide. Linda and Biff and Happy would be comfortable.