We are seeing Argentina with 50% inflation and Venezuela
with 10 million% inflation. The US is vulnerable to the same fate unless it can
cut federal spending and keep Treasury Bills paying 3%. If Treasuries go to 4%,
we’re in trouble.
US Debt stood at $21.21 trillion in June 2018. $6.89
trillion is owned by US investors. $5.75 trillion is owned by the US
government. $2.38 trillion is owned by the Federal Reserve and $6.21 trillion
is owned by foreign investors.
China
owned $1.18 trillion. Japan owned $1.03 trillion .Other countries owned $1.724.
If these buyers decide they can get a better return elsewhere, they will reduce
their purchase of US Treasury Securities.
Treasury Bills are purchased by governments and wealthy
investors as a “safe haven” for their emergency funds. They are also owned by
dumb pension plan administrators.
The US
federal government spends $4.1 trillion and States and Local governments spend
$3.4 trillion. That’s $7.5 trillion
which is 37.5% of our $20 trillion GDP.
Inflation
results when costs rise, but productivity doesn’t rise. Inflation is caused by the government
spending too much money on wars, welfare, health, education, itself and other
unconstitutional purposes. The excess money printed dilutes the value of all
money.
Our
current inflation threat is from our $22 trillion National Debt and our $124
trillion unfunded government liabilities. The US could find itself needing to
increase interest payments on the National Debt. The federal government is
paying for things that should be paid by the States or the People.
In
1913 the US Congress delegated its responsibility to “coin money” to the
Federal Reserve Banking System. In 1913, the US abandoned the Free Market
Economy System to go to a “Managed Economy”.
Inflation has been measured and recorded since 1914.
US Inflation was high from 1916 to 1920 due to World War I
and from 1940 to 1948 due to World War II. It also ran high from 1966 to 1985
due to the Vietnam War and LBJ Socialist programs. Currently, in 2019, 40% of
US GDP is spent by federal, state and local government. The 1913 US dollar is now worth 3 cents.
US Average inflation rate by year.
1914 1.0%
1915 1.0%
1916 7.0%
1917
17.4%
1918
18.0%
1919
14.6%
1920
15.6%
1921
-10.5%
1922
-6.1%
1923 1.8%
1924 0%
1925 2.3%
1926 1.1%
1927
-1.7%
1928
-1.7%
1929 0%
1930
-2.3%
1931
-9.0%
1932
-9.9%
1933
-5.1%
1934 3.1%
1935 2.2%
1936 1.5%
1937 3.6%
1938
-2.1%
1939
-1.4%
1940 0.7%
1941 5.0%
1942
10.9%
1943 6.1%
1944 1.7%
1945 2.3%
1946 8.3%
1947
14.4%
1948 8.1%
1949
-1.2%
1950 1.3%
1951 7.9%
1952 1.9%
1953 0.8%
1954 0.7%
1955
-0.4%
1956 1.5%
1957 3.3%
1958 2.8%
1959 0.7%
1960 1.7%
1961 1.0%
1962 1.0%
1963 1.3%
1964 1.3%
1965 1.6%
1966 2.9%
1967 3.1%
1968 4.2%
1969 5.5%
1970 5.7%
1971 4.4%
1972 3.2%
1973 6.2%
1974
11.0%
1975 9.1%
1976 5.8%
1977 6.5%
1978 7.8%
1979
11.3%
1980
13.5%
1981
10.3%
1982 6.2%
1983 3.2%
1984 4.3%
1985 3.6%
1986 1.9%
1987 3.6%
1988 4.1%
1989 4.8%
1990 5.4%
1991 4.2%
1992 3.0%
1993 3.0%
1994 2.6%
1995 2.8%
1996 3.0%
1997 2.3%
1998 1.9%
1999 2.2%
2000 3.4%
2001 2.8%
2002 1.6%
2003 2.3%
2004 2.7%
2005 3.4%
2006 3.2%
2007 2.8%
2008 3.8%
2009
-0.4%
2010 1.6%
2011 3.2%
2012 2.1%
2013 1.5%
2014 1.6%
2015 0.1%
2016 1.3%
2017 2.1%
2018 2.4%
2019 1.5%
Comments
The
minus years resulted in an increase in the value of money. The plus years
indicate the loss in the value of the US dollar.
Norb Leahy, Dunwoody
GA Tea Party Leader
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