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US Personal Income Declines $505.5 Billion as Inflation Rises

The U.S. Bureau of Economic Analysis (BEA) released data Friday on personal income and expenditures that all should pay attention to.

Personal income declined a massive $505.5 billion dollars for the month of January at the same time as consumption expenditures rose $18 billion, or 2.4%, on an annualized basis. Unemployment is high, people are earning less, and yet the cost of living continues to rise. The Federal Reserve should really pat itself on the back for inflating equities and bonds, distorting credit markets, and price fixing our way to prosperity. May we forbid the ills of falling prices, which lower costs in a time of declining income, only to push ourselves to the apparently impossible Keynesian state of stagflation.

http://seekingalpha.com/article/1241691-incomes-fall-505-5-b...



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ok... so years ago Ron Paul

ok... so years ago Ron Paul stood there and told everyone that we were going to have an inflationary depression. Basically the worst of both worlds. All the Prechterite Elliot wavers came in and bitched, moaned and groaned how that couldn't happen. they were right and Ron and the rest of us were wrong. Silver and gold would go way down, bla bla bla.... JZNEFF, in his being the economic guru of the universe just had to point out he was the one who was right period. All is well don't worry, good times are here again.. Well looks like Ron Paul and Peter Schiff are right again. It is a slow motion train wreck but it is happening. I hope all of you have taken the good advice on this site and have been stocking 90% silver, food, ammo etc. This thing is going to get nasty.

Cyril's picture

BUMP.

BUMP.

"Cyril" pronounced "see real". I code stuff.

http://Laissez-Faire.Me/Liberty

"To study and not think is a waste. To think and not study is dangerous." -- Confucius

Cyril's picture

Quick Math:

Quick Math:

So, that's roughly $1,600 per inhabitant, counting everybody, including the non working, non income-making people - babies, retired elders, etc.

Nice.

So much for the fiat currency of the first world power, and its central bankers, administrations, and planners.

Great job at destroying the people's wealth, simply thrown into the void, cherry on top of cake of an increasingly overwhelming national debt.

"Cyril" pronounced "see real". I code stuff.

http://Laissez-Faire.Me/Liberty

"To study and not think is a waste. To think and not study is dangerous." -- Confucius

Ignorance is the saddest part

People's wounds are being salted and it is so difficult to tie the cause and effect.

As the great John Maynard Keynes used to say:

"By a continuing process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens. By this method they not only confiscate, but they confiscate arbitrarily; and, while the process impoverishes many, it actually enriches some. The sight of this arbitrary rearrangement of riches strikes not only at security, but at confidence in the equity of the existing distribution of wealth. Those to whom the system brings windfalls, beyond their deserts and even beyond their expectations or desires, become 'profiteers,' who are the object of the hatred of the bourgeoisie, whom the inflationism has impoverished, not less than of the proletariat. As the inflation proceeds and the real value of the currency fluctuates wildly from month to month, all permanent relations between debtors and creditors, which form the ultimate foundation of capitalism, become so utterly disordered as to be almost meaningless; and the process of wealth-getting degenerates into a gamble and a lottery.
Lenin was certainly right. There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and does it in a manner which not one man in a million is able to diagnose."

Great quote

Keynes understood economics quite well, I believe. His prescription for inflation was about politics, not economics. I also believe Bernanke understands it exactly the same way. It is not a difficult concept. That might explain why Bernanke, and Greenspan before him, give contradictory statements. They know a select few will benefit from the inflation, and their job is to make sure that continues.

Greenspan, especially, was noted for complaining about the 'irrational exhuberance' of the market place all the while he was enabling the continuation of that behavior with artificially low interest rates. We know he understood the inflationary factors behind the run up in the market because he wrote a wonderful article in support of the gold standard in the 1960's, and as late as the mid 2000's he acknowledged the article and said he still agreed with every word. Yet he acted in ways contrary to his own stated understanding of how an economy works.

It's not that they are ill-informed, or incompetent, or negligent. It is that they have chosen to take actions that are damaging to the economy for the sake of supporting the ambitions of a select few. They are criminal.