Inflation is one of the subtler culprits of the prevailing world order. Currently, inflationary condition is more pronounced in the poorer countries of the global system than anywhere else. This is because aspiring countries still have a long way to go in their ‘catching up’ project. On the other hand, because of demographic conditions and demand saturation, the core countries of the system are continuously threatened by deflation, at least at the macro level. At the grass root level however, rising living expenses (establishment figures aside) keep on decimating the sheeple’s (human mass) standard of living in the rich countries. Unfortunately, modern states, instead of protecting their citizens from inflation, have become the very source of the problem! There are two main reasons why inflation is encouraged by the world system.
One is; the existing interstate system depends on phony money for its very existence. Phony money, money not earned, but printed, is the source of real inflation. In the words of the ‘father of the 20th century monetarists’: ‘Inflation is always and everywhere a monetary phenomenon and in the sense that it is and can be produced only by a more rapid increase in the quantity of money than output.’ Milton Friedman. The parasitic elites of the world system reckon; earned money (in an honest segment of the economy) is for suckers; the working stiff, the ‘salary man’, petty traders, etc., Printed money, they surmise, is for them and their partners in crime. This rent seeking group includes all those actors, economic or otherwise, whose claim to wealth is primarily the money spigot, profusely channeled either via state agencies or market operators! By and large, it is this ephemeral wealth what everybody and his uncle are talking about all over the world today. The oft talked about global economic growth is (unsustainable and polarizing) to a large extent, the outcome of the phony money system.
Even those once productive entrepreneurs and corporations have succumbed to the perverted logic of phony money. If truth be told, without creating money out of thin air, the fixation on growth cannot be sustained. When the going gets tough, it is the states that back the superfluous wealth that has been created by phony money. See Bonner’s article next column. As it stands, stock markets are being owned, increasingly, by central banks-the real heavy weights behind the printing press of phony money. For example, the Bank of Japan is now the largest shareholder, by far, in each of the major corporations of the Japanese state. The central bank of Switzerland owns billions of US dollars worth of shares in the major western corporations, Apple, Microsoft, Netflix, Facebook, Amazon, etc.! The EU has instituted a policy of buying shares of European corporations (not always strategic and large) that are not making the cut, so to speak. Why work hard when states are always there to bailout, not only financial institutions like banks, but also run-of-the-mill companies (usually connected to the power that be) in the equity market!
The second reason the global status quo likes inflation is; governments need to inflate their currencies in order to service their debts and pay principals. Inflation also helps hoodwink the gullible, by making them think they have more money than ever. The extreme case is when everybody becomes (or used to be until recently) a millionaire if not a cool billionaire; like in Zimbabwe and the Weimar Republic (1920/30s) of Germany. Eroding purchasing power on a continuous basis is what triggers outrage and insurrections in many a society. Inflation is also an ideology of sort. It has a tendency to keep the sheeple on the running mill, without allowing it to critically examine why it should be so. Due cognizance of such rampant inflation is the main reason why collective humanity is forced to join the rat race. The world’s population, almost without exception, remains fixated on the fear of inflation. From doctors to peasants, from scientists to janitors, from preachers to peddlers, etc., are all systemically defocused, thanks to inflation. Obsessive focus on the day-to-day grinding, to make ends meet, is what inflation doses to the global sheeple. As a result, critical thinking and sober reflections ended up in the domain of the privileged and the seriously rich. Between inflation and indoctrination, the global sheeple has been rendered impotent. How else can one justify the dormant behavior of global humanity when the very life support systems are being systemically destroyed by the greed regime?
Critical souls who remain relatively independent and sorely feel the need for a more just and sustainable world order have become determined to derail the shallow neoliberal globalization of our time! To this end, various projects are in the offing. The various new currencies/crypto-currencies belong to these initiatives. The time proven currency of precious metals is also making a comeback. The fiat money system, without any backing, has been undermining gold for decades. Replacing the fiat currency regime that is pointedly making the working stiff poor and the lumpen bourgeoisie rich, while undermining the natural world, should be given the utmost priority! Currently many countries of the world want to horde the old glittering relic, to paraphrase the canny rhetoric of the establishment. Here are some commentaries on the nature of inflation, from hardcore supporters of the global order.
‘Inflation is as violent as a mugger, as frightening as an armed robber and as deadly as a hit man.’ Ronald Reagan. ‘Inflation is the parent of unemployment and the unseen robber of those who have saved.’ Margaret Thatcher. “By a continuing process of inflation, government can confiscate, secretly and unobserved, an important part of the wealth of their citizens.” John Maynard Keynes. Good Day!