half and half 1 of 3

HALF AND HALF

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note: I would be VERY cautious about buying stockpile batteries from Family Dollar.  I've bought and hoarded AA and AAA's from dollar stores for a long time.  I rotate them and have never had a problem even after two or three years.  The other day I opened a pack from Fam$ that still had 16 months to go to expiration ( and which I had bought less than a year ago ).  They had NO juice in them at all.
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ATTENTION!!!ATTENTION!!!! Incredible.  Rush down to Kroger NOW this very day and stock up on shortening.  I don’t know if it is a sale or the new everyday price.  But a tub is only $1.79!!!!!!!!  No other grocery comes close to being so low in price, especially not Wally.  In a nice thick plastic tub ( although the top is a bit flimsy ).  You need fat in your post-collapse diet and even if shortening isn’t that good for you, being without is worse.  Do NOT plan on burning your body fat to supplement your diet.  Go!  GO NOW!!!!!  Old price, close to $3.  Still the best bargain around.  But at the new price, you buy NOW!  Even if you only use it for barter.

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I’ve mentioned not too long ago that I was on the fence as to whether inflation was as assured as I had imagined.  All my life I’ve lived under inflation, as have you, as well as being completely convinced hyper-inflation was our End Game.  As have you all, I’m sure.  Now, for some decades the Deflationists have tried to debunk this convention and I’ve never really bought into their arguments.  They use the historic Russian Dude economic cycle, the Numbered Waves demographic theory, and everything in between.  The problem with their arguments is that they believe the last 500 years of hyper-Western wealth is the norm when all it is was an aberration of resource extraction unable to be duplicated ( for a time, even in the face of US Peak Oil followed by global per capita energy use decline, the optimists even argued that colonizing space was a way to Pretend To Extend; a very shallow and embarrassing current example is the FrackTards ) ( if you go back further and track the supply and prices of basic feed grains, overpopulation and solar cycles point to inflation as a much better guide ).

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It is hard to find an example of an empire that didn’t end in hyperinflation.  Inflation didn’t cause their collapse but was a symptom of resource contraction.  When you have the choice of giving up power and wealth today, sparing the citizens the wraith of total economic collapse, or holding on as long as you can even if you end up making things far worse, everyone always picks the immediately less painful option.  You could probably find some examples to refute that statement, perhaps bringing up British Empire.  True, they went with the Druid Dude Collapse Option and signed up for a long slow relatively uneventful collapse so that from a century ago controlling a good size economy and real estate to today having a national budget not too far away from just one of the US states, but this ignores, once again, the last five centuries.  The same bankers that introduced the successful “central bank funded empire” in England had control of most of the Western countries economies at one time or another during the colonization period and can be almost considered one empire rather than several.  One area was drained of resources and the elite moved on, the local population suffering but the infrastructure stayed reasonably intact.  Spain hyper-inflated but was unique in that rather than fiat currency, they flooded the economy with precious metal.  Of course there was other inflationary times, but one would hesitate to call these empires.  The less of a “real” empire an aspiring group was, the less likely they kept a stable currency and the less likely that they were under the bankers control.

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My point is, you can quibble over which empire did or didn’t end in hyperinflation.  Most likely all your examples are recent.  But if you go back past carbon fuel inputs, I would say my contention is valid.  Once resources diminish past the growth/infrastructure maintenance stage, the money supply is given a rough sodomization.  It is one of the last ways to kick the can down the road.  So I find it hard to argue inflation won’t happen.  Some economists try to have it both ways.  They claim that we will have a period of strong deflation until hyper inflation kicks us in the ass.  Others point to our duel economy, where necessities are inflating and optional goods or services are deflating.  This makes a certain amount of sense.  If you think you need a house, prepare to fork over half your income for all your life.  If you think you need health care, give up your other half.  That doesn’t leave much for food or transportation.

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Deflation isn’t seen in falling prices, as that is impossible under our current mega-corporation fascist régime.  The federal government isn’t the only organization that knows how to trade in the future for an extension on life support.  Everyone that is anyone borrows extreme amounts of money to keep their corporation running, and the difference between what they pay on their loans and what the small fry do determines who stays in business.  Why do you think you pay $20 for a pizza?  Because of the ingredients?  The cost of minimum wage labor?  Of course not.  It is to service the debt the corporation used to crush its competitors.  And I’d even wager that the company would lose money on that pizza if they suddenly had to pay 3% interest on their loans rather than 1%.  That is how screwed up the economy is.  But it also explains why prices can’t fall even in the face of falling demand. 

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Deflation is only seen in the lower level of price inflation.  On Obummer’s watch, our national debt doubled.  It actually quadrupled if you factor in the other national central banks we bailed out eight years ago, but since the over quadrillion dollar derivatives market will implode the whole global economy I don’t think that decision alone is too much to worry about.  But with all that liquidity added to the global economy, our prices should be a lot higher.  Food should have more than doubled or tripled, for instance.  Since all that new money has basically gone into stemming the banks bleeding out ( creating assets they lost in the ‘08 crash ), the consumer economies haven’t really seen the inflation they would have.  But we don’t have a classic deflationary period either.  Just be thankful prices aren’t much higher.  Yet, we are still seeing massive unemployment and imploding consumer demand due to a classic overcapacity globally.  This is why deflation has made any appearance at all. 

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So, what is it going to be?  Deflation as nobody works and most factories are idol?  Or inflation as countries and empires have no other way of paying their bills ( there is no way China will ever have enough gold compared to its spectacular debt-they have joined the West in inflating away their currency-a race to the bottom )?  Continued tomorrow.

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