We are in the most inflationary times in forty years. The cost of housing has gone up 25% in San Diego in one year. The cost of water and energy is up by double digits in one year. Look at the prices of USED cars, skyrocketed. Go to the grocery story. The cost of meats is up more than 30% in just one year.
: Inflation is a form of taxation –- taxation without legislation. With a tax increase, a society might get a new highway or a new hospital. With inflation, society gets nothing. Inflation bears down heavily on low-income people and retired people living on fixed incomes.
The cost of the train to nowhere ten years ago was $33 billion and to be completed in 2024. Today the cost is going to be close to $150 billion and might be completed sometime in the 2040’s—if ever.
This is why inflation in killing us—whether it is in the cost of goods and services in the private sector. Or, in the cost of government. Instead of rising taxes, government creates inflation and the higher costs also mean higher tax revnues.
By Richard Colman, Exclusive to the California Political News and Views, 3/2/22
“When there’s blood in the streets, it’s time to buy.”
That’s what Baron Nathan Rothschild of the famous European banking family allegedly said, in 1815, about stocks.
Currently, there’s blood in the streets of Ukraine, but stocks are tumbling. During February 2022, the S&P 500 stock index lost value. According to The Wall Street Journal (March 1, 2022, print edition), “The S&P 500 and Nasdaq have lost 8.2% and 12% respectively over the past two months, each posting their worst such stretch since March 2020.”
With the Russian military bearing down heavily on Ukraine, stock market losses could go even higher. Currently, the United States is experiencing the worst inflation in 40 years. From January 2021 to January 2022, inflation, according to federal government statistics, rose 7.5%.
During the last 12 months, prices for gasoline, food, and home heating oil have risen dramatically. Instead of raising interest rates to curb consumer spending on houses, cars, and food, the Federal Reserve has done nothing to slow inflation.
Economic statistics from 1960 to 2020 show that when the Federal Reserve prints too much money, consumer prices rise in tandem.
Inflation is a form of taxation –- taxation without legislation. With a tax increase, a society might get a new highway or a new hospital. With inflation, society gets nothing. Inflation bears down heavily on low-income people and retired people living on fixed incomes.
Whatever is happening in Ukraine, the American government must give top priority to halt the egregious rise in prices.
The Federal Reserve should immediately begin raising interest rates to stop inflation. In many parts of California, regular gasoline now costs more than $6 a gallon.
There is no guarantee that there will be a continuation of rising stock prices as occurred from 2019 to 2021.
And there is no guarantee that blood in the streets will boost stock prices.
