Everything I own is sharply lower as apparently American’s gaining employment is something to be feared.
I will try to explain this to you. The reason we have had no inflation before now is because even as the monetary supply rocketed to untold heights, the velocity of money was collapsing. All of the deflationists have been harping on the sound money crowd because they believe they can control employment levels by printing ugly pictures of dead people (which is stupid).
Now that employment is regaining its stride, Americans will have more to spend, and you can probably expect the velocity of money to start picking back up. In fact, if you just bother to look at my new position OMAB, flight volumes are surging to vacation destinations as an example.
We have made much ado about the ever higher levels of debt owed by Americans. Well the numbers aren’t really that bad either. Does an extra $300 of credit card debt on average per year really signify the end times? The debt has almost no carrying cost at the moment; even average citizens can take hold of these zero percent interest rates in one way or another.
The point, good sir or ma’am, is that the monetary supply outstanding is still quite a bit larger than it was five years ago and there is no good strategy to unwind that. Employment numbers picking up are the first stride to wage growth which will usher in the final stretch of the recovery – inflation.
And that inflation will probably get out of hand, because the probability of a perfectly controlled, centrally planned recovery is exactly zero.
Don’t be surprised if commodities experience a second awakening in the not too distant future.