Inflation & what Purchasing Power of the Dollar means to Normal Middle Class.
#INFLATION - Its what everyone is talking about recently, but not everyone truly understands the significance of what inflation and its continued increases will do to our economy, and our way of life (both personally and in a national sense). What a US dollar can buy you is the "Purchasing power of that dollar". Government rarely talks about it and that's how you know we're in bad shape. And Main Stream Media doesn't report it because....well..... to be blunt they're mostly rich socialists who cant fathom the concept that anyone who has less than them wants a better quality of life. It's important to know the baseline of where Purchasing Power started to better understand what it has fallen to today. How our cost of goods sky rockets and increases and the dollars that we make to buy them with continue to shrink. In 1913, the year the Federal Reserve System (or The FED) was created with $1 you could have went to the store and bought 30, 1.875 oz. Hershey's Chocolate Bars that were 100% natural and made in America from the Dairy Farm to the Packaging plant. In 2020 you can go to the store and buy a single, 1.55 oz. Hershey Chocolate Bar that contains soy lecithin, emulsifiers, and artificial flavorings that are now mostly made in Monterrey Mexico where Hershey relocated about 4-% of its manufacturing line in 2007 and has increased capacity there since. So to summarize the example: today to buy less chocolate, in a product manufactured in a foreign country, made with fillers and cheap additives you're spending about 30x what you would of had to in 1913 to buy a 100% natural chocolate bar that kept the US dollar in the USA so our Circular Flow could thrive and benefit America and its citizens.Thus NOT helping to cause inflation. And know that there are experts and institutions that saw this coming. investor Michael Burry predicted the inflation spike a year ago - and sounded the alarm multiple times in February. But the political elites and power banks just ignored him.
We are walking on the longest double edged sword in US History. And we're damned if we do.
As more dollars came into circulation, average prices of goods and services increased while the purchasing power of the dollar fell. By 1929, the value of the Consumer Price Index (CPI) was 73% higher than in 1913, but a dollar was now enough only for 10 rolls of toilet paper. More Dollars in the System
Money supply (M2) in the U.S. has skyrocketed over the last two decades, up from $4.6 trillion in 2000 to $19.5 trillion in 2021.
The effects of the rise in money supply were amplified by the financial crisis of 2008 and more recently by the COVID-19 pandemic. In fact, around 20% of all U.S. dollars in the money supply, $3.4 trillion, were created in 2020 alone. *