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Inflation: Ignoring Doesn’t Make it Go Away

By: Richard Daughty, The Mogambo Guru - The Daily Reckoning

-- Posted Monday, 8 February 2010 | Digg This ArticleDigg It! | | Source:

Being absolutely Frightened Out Of My Mind (FOOMM) about inflation, I am always looking at how much things cost and seeing if there is any inflation, so that the next time somebody tells me that inflation is “tame, benign, absent, nothing to worry about”, I can shake my proof in their stupid little faces and say, “Oh, yeah? Then what do you call this, ya moron?”

I bring this up because I recently got a “time to re-subscribe” notice from The Wall Street Journal, which has been, over the years, consistently denying that there is any inflation in anything, and thus suggesting that – with such a benign economic milieu, which keeps interest rates down – you should run out and buy stocks and bonds right away, using, one presumes, the WSJ to keep up with the news.

The interesting thing about the supposed competence of the WSJ in seeing inflation is that a subscription to the paper now costs $385 per year, whereas as early as the middle of 2004 it cost $338 for a TWO-year subscription. So The Wall Street Journal, as oblivious and clueless as ever, has seen its own prices more than double in 5 years, which comes out to a compounding of 14.87% increase per year, but yet they can’t see inflation in prices? Hahahaha!

And you would think that the official estimate of price inflation, 2.7%, as reported in their own Barron’s magazine, would ring a few bells at someplace other than at the Mogambo Bunker Of Extreme Paranoid Hostility (MBOEPH), where I have alarms going off all the time, signaling huge increases in prices, which is important because it makes the plight of the poor more desperate, a situation made more “up close and personal” when you realize to your horror that there a LOT of poor people all over the place – millions of them! – and you could not possibly afford enough ammunition to defend yourself against them all. Yikes!

And not only that, but your supply logistics are compounded not only by the fact that all of these poor people getting poorer and more desperate because prices are always rising, but also because there are a lot of people who were NOT previously poor who are NOW poor, or soon will be, thanks to rising prices, which means that you should be constructing a fortified bunker of your own from which to pour awesome firepower to repel these starving morons who are getting what they so richly deserve for voting for the idiotic, deficit-spending politicians that they so greedily, and so stupidly, elected, year after year, decade after decade, until my throat is sore from screaming in outrage.

When it comes to actual proof of a coming inflation that is going to destroy the world, instead of just me loudly running my mouth about it, where the only good news is that The Mogambo (me!) can rise from the ashes to assume full dictatorial powers and a huge salary-and-benefit package to re-establish the gold standard and real prosperity to America, one need only look at the last two pages of The Economist magazine, where we find, among the 40 biggest economies in the world, that all of them have inflation in consumer prices! Well, all of them except Singapore (where inflation is zero), Taiwan (negative 0.2%) and Japan, where prices are supposedly falling at 1.9% a year.

This is such an important thing that I get interviewed about it a lot, and the inexperienced interviewer usually steps into my trap when I ask, all smiles and sweetness, “Would you like to know where inflation comes from?”

If the reporter says, “You ended that sentence with a preposition.”, then I will spare them my explanation about the origins of inflation, as it shows that they are pretty smart and will soon figure it out for themselves, and in the meantime we can change the topic of conversation to the important subject of how some little squirt comes in here and insults me, right to my face, about some stupid fine point of grammar, and how I maybe ought to take my stapler and tack a piece of paper that says “Don’t insult The Mogambo!” to their damned foreheads as a way of remembering not to do that ever again.

Also, some of the time, they ask, “Is there anywhere I can sit where I don’t have to smell your breath or your feet that are gagging me out?” but most of the time they merely want to know from where inflation comes, and then I am ready!

I leap to my feet with a theatrical flourish and thunder, “It comes from an increase in the money supply, you moron! How in the hell did you think that it is possible for the prices of all things to go up without more money to pay for it all? Velocity of money? Hahaha! Don’t make me laugh, you miserable little halfwit!”

When they sit there, stunned at the vicious attack, then I am ready to hit them with the big one! With a theatrical turn to the last page of The Economist magazine, I show that of the 40 biggest countries in the world, 39 of them are running a negative “Budget balance as a % of GDP”! Huge deficits! Up to an enormous 4% of GDP in Britain, and now 11% (a monstrous $1.6 trillion) in the USA.

Only Norway is running a budget surplus, which means that those 39 moron governments are going to spend more than they get, and to keep from having to raise taxes to get the money (boo!) or borrow that money from taxpayers/consumers (boo!), their idiotic, corrupt central banks (boo!) are going to let the banks create the money (boo!) necessary to buy those bonds! Hahaha! What a scam!

In summary, to make sure they know how important this is by how close my face is to theirs and how I am so close that our noses are almost touching and they can feel drops of spittle hitting their scared little faces as I shout, “We’re freaking doomed by the creation of too much money! Do you understand that, you whimpering little moron? Doomed!”

It is usually about this time that reporters and interviewers recover find that they want to leave because they have “enough” material, which they do, but they don’t even realize it. Morons.

-- Posted Monday, 8 February 2010 | Digg This Article | Source:

Visit The Daily Reckoning's website.


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