This was a letter through the comments section written by John Thompson to the Editor in relation to “Vantage Point with Mike Young.” These comments are now a regular series article called “To Your Freedom.”
By John Thompson
Vantage Point: Our Hearts Go Out to Texas
As the old saying goes, if it ain’t broke, don’t fix it.
This seems like common sense. Yet the guy with five decades of political experience can’t seem to apply such a simple lesson to tackling inflation.
Think about it– inflation has been raging for more than a year. Yet they’ve changed almost nothing.
Most notably there’s the Chairman of the Federal Reserve, Jerome Powell, under whose leadership the United States has experienced its worst inflation in 40 years.
His approach so far has been nothing short of extraordinary. It started in February last year when he denied inflation was even a problem, insisting that “inflation is just very, very low”.
A few weeks later he started singing the ‘inflation is transitory’ chorus. By June 2021 he doubled down, saying that higher inflation would soon wane. That’s also when he projected a 2021 inflation rate of just 3.4%.
By December, his 3.4% inflation projection proved hilariously wrong; 2021 inflation came in at 7%. And yet the Fed still hadn’t yet lifted a finger to stop it.
He even gave a press conference late in the year saying, “I don’t think that we’re behind the curve. . . I do think it’s premature to raise rates today. I don’t think that’s controversial, certainly, I don’t know anyone arguing for that today.”
Seriously? Out of hundreds of millions of people across the country suffering higher prices, he literally didn’t know a single person who thought the Fed should be doing more to fight inflation? What a joke.
But this comedy of errors gets better.
Home prices across the US had surged 20% by December 2021. And yet, the Fed was still printing tens of BILLIONS of dollars per month to ‘support the housing market’. This is more ridiculous than Kanye West receiving millions of dollars in PPP loans (which really happened).
Apparently, the Fed didn’t think that a 20% surge in home prices was a reason to change anything about their approach.
This is the larger point– everything was broken. Powell’s Fed printed trillions of dollars and helped engineer inflation. Yet they failed to predict it. They rejected it. They downplayed it. They continued fueling it. And they did absolutely nothing to stop it.
In any rational organization, this person would have been fired long ago. And yet, two weeks ago, he was sworn in for his second, five-year term as Fed Chairman.
It’s the same story with Janet Yellen– Powell’s predecessor as Fed Chair who is now the US Treasury Secretary.
Similarly, Yellen failed to see how keeping interest rates near zero for years and years could possibly lead to inflation. She also failed to see how trillions of dollars in government spending could possibly lead to inflation. And she has failed to do anything about it.
Yellen at least had the stones to admit she made a mistake; last week she told reporters that she was wrong when she called inflation “small and manageable” back in 2021.
Like, Jerome Powell, though, she’s still in her job.
The list goes on and on. Nobel Prize-winning economist Paul Krugman also recently acknowledged that he “called inflation wrong last year” when he insisted that government spending would not cause inflation (Krugman is the same guy who went on CNN years ago suggesting the government should lie about a phony alien invasion as an excuse for to spend more money).
It’s extraordinary how some of the most prominent ‘experts’ have been so wrong. And yet they’re all still in their same positions.
I’m not trying to be cruel; we’re all human, and we all make mistakes. But it’s silly to pretend that these experts are flawless and infallible.
They’re not flawless. They’re not infallible. Nothing is.
The police response to the terrible, horrific shooting in Uvalde proves this in spades; the institution that people trusted to keep their kids safe made “the wrong decision” to not go inside and save the kids.
The people in power expect you to have unshakable confidence in their institutions and experts, and to depend on them for nearly everything, including your safety, health, information, and prosperity.
But sometimes the experts are tragically wrong. And that’s reason enough to have a Plan B.
To your freedom,
John,
I was a baby/toddler Holocaust kid who came within hours of death. As a first and second-grader I played with a cigar box full of paper currency bills left over from a hyperinflationary collapse.
Money became ever more worthless at an exponential speed. Like million mark bills were over-printed with a black print “Billion,” like doing that with your home printer. Workers were paid twice a day so their wives could spend it as fast as possible.
Guess, how close is the dollar to the trigger point when its purchasing power decline might go parabolically ballistic?
If that should happen, its international consequences would be beyond our collective imagination.
Armin; You are so right !! and there is a lot of talk everyday on a CURRENCY RESET with the US dollar !! Your post is spot on !!