Sunday, October 27, 2013

Inflationary strategy

At least we're now on notice. The Left thinks it's ready to start squeezing the little people with inflation.

The New York Times notes:
The Fed has worked for decades to suppress inflation, but economists, including Janet Yellen, President Obama’s nominee to lead the Fed starting next year, have long argued that a little inflation is particularly valuable when the economy is weak. Rising prices help companies increase profits; rising wages help borrowers repay debts. Inflation also encourages people and businesses to borrow money and spend it more quickly.
But the Times also notes:
As inflation accelerates, economists agree that any benefits can be quickly outstripped by the disruptive consequences of people rushing to spend money as soon as possible. Rising inflation also punishes people living on fixed incomes, and it discourages lending and long-term investments, imposing an enduring restraint on economic growth even if the inflation subsides.
It may well be the level of intentional pain is about to rise on those who can least stand to bear it.

Plan accordingly.

No comments:

Post a Comment