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Date Posted: 17:10:49 4/23/23 Sun
Author: Jasper
Subject: From David Stockman

.
So Greenspan pretended to be the champion of sound money by taking credit for a phony gain he was pleased to call “disinflation”. The latter amounted to deliberately depreciating the purchasing power of savers and wage earners, but just not quite as rapidly as during the worst days before Volcker.

Needless to say, in a globalized economy inflationary money is quite the trickster. In the initial instance it led to the massive and relentless off-shorting of production, and the re-importing of the same goods produced abroad via the cheap labor being requisitioned from China’s vast interior rice paddies.

Inflation of the dollar came back as deflation of durable goods prices!

It also allowed the Fed to claim that it had vanquished inflation and that its altogether new challenge was the madness called “lowflation” or too little inflation. That’s truly when the Keynesian central bankers lost their minds.

Alas, the trouble with “lowflation” is that it was a one-time aberration, not a permanent or sustainable condition. As the above sharp hook in the chart attests, the sub-index for durables is now up by 15% from the bottom, even as the global supply chain continues to contract owing to the exhaustion of cheap labor in China and badly lagging political patience with free trade in the US and throughout the west.

https://dollarcollapse.com/david-stockman-on-why-decades-of-inflationary-finance-are-finally-coming-home-to-roost/

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