U.S. Inflation Gaps Up by Largest Amount in 32 Years
December 19th, 2006Via USA Today:
Inflation at the wholesale level surged by the largest amount in more than 30 years in November, reflecting higher prices for gasoline and a host of other items.
The producer price index, which measures inflation pressures before they reach the consumer, was up 2% last month, biggest advance since a similar increase in November 1974, the Labor Department reported Tuesday.
Economists had been expecting a rebound in wholesale prices following two months of big declines. However, the 2% jump was four times bigger than the 0.5% increase they had forecast. Even excluding volatile energy and food prices, core inflation posted a 1.3% advance, biggest jump in 26 years.
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If you went to a government school, you have ABSOLUTELY NO IDEA how money is created in our country.
Inflation is not some mysterious raising of prices, but the increase in the money supply.
Here is how it happens:
http://tinyurl.com/t7uke
Remember playing Monopoly? Imagine now another player called ‘The Government’. It goes to the bank and says, print more $500 paper and we will give you Treasury Bills which are promises to tax all the other players to pay you interest!
Now imagine ‘The Government’ has a massive pile of $500 bills and starts buying up as much property and hotels as it wants! The bank starts loaning the regular plays as much money as they want to buy property as well. Guess what happens to the price of Boardwalk?
The other players are now stuck with Big Debt and High Taxes to pay the interest on the T-Bills to the Banks. Sound familiar, like maybe your life?
Now that is inflation.
INFLATION Board Game!!
In the middle of the great depression the INFLATION! board game was copyrighted by Rudy Copland in Fort Worth Texas.
http://tt.tf/gamehist/rules/infl-1936.html
http://tt.tf/gamehist/rules/infl-r.html
http://en.wikipedia.org/wiki/Great_Depression
I remember Monopoly well. When little, my sister and I were able to play never-ending games simply by “printing” additional Monopoly money. Of course this led to inflation. Boardwalk with 4 hotels became rather an expensive place to stop! Little did we know what we were indeed learning.
I went to a government school. Thank you very much for the informative posts!