by Harris Sherline, CPA
The scene is being set for hyperinflation, with panic efforts to “stimulate” the economy and “save” financial institutions and industries that are considered too big or too important to fail. Obama’s plans to spend upwards of another trillion dollars on a second “stimulus package” and as much as an additional trillion dollars for new programs (as yet undefined) will soon cause inflation to begin anew. It’s difficult to predict exactly when hyperinflation is likely to occur, but unless we stop creating fiat money and borrowing as if there is no tomorrow, it’s sure to happen.
If and when the Chinese, the Japanese, and the oil rich Arabs decide that it’s no longer safe to hold their wealth in American dollars and start selling U.S. bonds, there will be a sudden drop in the value of our currency with a corresponding increase in inflation.
The American public seems to instinctively understand that what’s going on is wrong, but the economically ignorant, bone-headed politicians who are in charge simply don’t get it.