Why Low Inflation Seems High

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Japan central bank impose 0% interest rate since 16 years, and make QE after QE so that small Japan has approximatively printed as much money as big USA (please Google: "global narrow money supply" in pictures). Has Japan created hyper-inflation? NO! Private banks have created worldwide from nothing 1 quadrillion $ liquidities (Google "quadrillion $ derivatives", in text). Has they created hyper-inflation? NO! So the FED QE2 of 0,0006 quadrillion $ will not create hyper-inflation! The only way to create hyper-inflation is to hyper-inflate the financial costs to 21%, as Adolph Volcker did in 1981, rising massively Consumer Prices in the eighties, because farmers have debts, and if the banks want 21% financial costs from the farmers, then farmers must pay 21% interests, so they must rise all food prices! In China, central bank inflate financial costs now, and farmers are forced to rise food prices +10%. In USA, financial costs are low, but israeli traders speculate on cereals, because they want that Tunisia, Egypt, Algeria, Iran etc changes to democratic countries... And banksters speculate also on oil price, because they are allowed from Basel 3 to use a leverage factor of 33! USA would need a QE3, but only combined with a pharaonic project to give work to 50 millions discouraged workers in USA: without pharaonic project, QE3 would be stupid!

Jean-Francois Morf, Charrat, Switzerland 3:58AM February 16, 2011

those who feel inflation is under control and the economy is improving have
their head in a position similar to the ostrich. They most certainly are driving
a foreign car, wearing clothes made abroad, eating imported food(and not
Chilean sea bass) and wondering why everyone is not employed as they are.
If there is an answer you must look inside yourself to find it.

The John of NJ 9:45AM February 12, 2011

Recently the Chinese communist leader told us that the American dollar is a product of the past. Well I hate to say it but that commie bastard is probally right. Our "own" "American" corporations have sold us out to the Chinese for a fast buck. Remember that most of these are international corporations and see no difference between American labor and third world labor. They have been allowed to place the American people upon an unlevel playing field with regards to wages and free trade. Without stiff tarrifs we can't compete with the pitifull wages. Look at lack of environmental regulations in China! And what about red tape that companies have to put up with In the USA. The new carbon taxes, clean water regulations, taxes, fees,lawsuits, fines ect.... Wake up America or it will soon be a quick down hill slide into third world status.

richard of SC 2:33AM February 12, 2011

Politicians conspire to falsely lower inflation because:
(1) Social security, federal and local pensions, new federal securities such as I-bonds, and many other outlays are essentially indexed to reported inflation rates. Less reported inflation equals lower than otherwise money out and lower deficit spending (which they waste elsewhere.)
(2) They want to look good to the public. Inflation breeds voter dissatisfaction with the party in power and reflects badly on their image. (No second term for you, naughty Jimmy Carter!)
(3) Government economists in planning positions display themselves in their Emperor's New Clothes to their peers. Treasury Department types brag to their counterparts abroad facing reportedly higher prices.
From my many years observations as as a financial economist on Capitol Hill.

k25 of VA 7:11PM February 09, 2011

As I watch prices in the United States rise for basic staples, more and more homes and jobs lost, and see that corporations are making bigger profits than ever, and the wealthy are enjoying even greater monetary success, I realize, with great sadness, that we are treading down the road to being a third-world country. For those of you who do not study history, SES and health statistics, World Banking and World Trade, etc., a country becomes a third-world country when the rich get richer, the poor get poorer, and the middle-class disappears.
The United States has sold themselves out to corporate power, has allowed corporations to become citizens of the United States--citizens, by the way, with tons of money--and we all well know--money talks. While all this was going on, I watched editorials, newspapers, "certain" radio and television programs, and online blogs and comments, deteriorate into propaganda. These propaganda programs are paid, also, by corporations who have already dismissed the human citizens of this country to a "have not" status, while the corporations are the "haves."
For those who now denigrate unions, I understand why; most unions in the United States have been corrupted by union officials who regard a union as another way to make themselves rich. The original premise of unions was to create a better environment for the "common man" who worked hard for very little money. In addition, hiring children for far less was another common practice before unions. Anyone, could be fired on any day, at any time, for any contrived reason possible.
The common man" rose up and demanded better treatment from employers, and unions were born. As you must realize by now, once unions are gone, we go back to the past business practices. We who say it is important to study history, because, if we do not study history, we are doomed to repeat history, are already repeating history. Instead of learning from Theodore Roosevelt and Thomas Jefferson that corporate power will overtake us, and ruin this country, our own U.S. Supreme Court cast aside Roosevelt's and Jefferson's warnings, and gave citizenship, and, therefore, greater political power to corporations. 15 million jobs have gone overseas, we have nearly 10% unemployment, but underemployment rampantly reigns in this country, too.
Now we learn what an economic plight most of us must endure, and we still have people who think our present administration sent 15 million jobs offshore, caused Wall Street to destabilize, and editorials do nothing but "yap" about birth certificates, race, the "wrong" religions, and the "good for nothings" who are in need of jobs and health care. God is watching us....

anna banana of MI 9:12PM January 30, 2011

I've never understood why the government calculates inflation they do. Ignoring some of the most essential things because their prices are volatile is absurd.

Scott of MN 3:03AM January 30, 2011