Inflation Explosions in a Financial Action Film

There was an interesting item in The 5- Minute Forecast which read, “Within 12 years, the largest item in the federal budget will be interest payments on the national debt,” which is pretty scary for guys like you and me, especially if you are, like me, a paranoid, frightened and angry little man who sees nothing but complete catastrophe looming up, rising up out of the mists like a fearful Gorgon to turn you to stone, because the federal government is borrowing and spending too, too, too much money, all of which is supplied by the Federal Reserve which is creating too, too, too much money and credit, which is horrifying because such massive inflation in the money supply will, by necessity, destroy everything with ruinous inflation in prices because, unfortunately, that’s the way it works.

This simple fact has given me the idea to make some Award-Winning films (“Worthless trash!” says The Chicago Sun) using the plots (but without paying for them) of some scenes from Sylvester Stallone movies, such as John Rambo bursting up out of the water with that snarl on his lips and an AK-47 in each hand, who immediately starts blasting away, the whole scene shot in slow-motion, Rambo blowing the hell out of everything in a cacophonous hail of fiery gunfire and spent cartridge shells, things catching on fire, things exploding, bodies flying through the air, people screaming, and it is all one (pause for breath) one hell of a mess.

That’s inflation for you! Okay, maybe except for the part about real bullets, and things catching on fire, and things exploding, and bodies of people flying through the air, but it is exactly true of people screaming and it is (again pause for breath) one hell of a mess.

Now, think again about adding to your home video library your own copy of a terrific action flick of Rambo jumping up and shooting bad guys and everything to smithereens, only re-cast Rambo with the Federal Reserve, change his weapons into Fed Credit that have infinite dollars as “bullets”, and change “bad guys” into you as the “smithereens.”

Not interested? How about if I add in a few long, long scenes of pretty, scantily-clad ladies prancing around for no particular reason, a short exciting car chase ending with a crash, and some more scantily-clad ladies (but different from the first ones)? Are we suddenly talking box-office gold? Whee!

But this is not about a hypothetical career change, going from angry and paranoid hothead cowering in some stinking bunker and writing Stupid Mogambo Crap (SMC) about fiscal and monetary policy and the idiots who are screwing it up, to blossom into a Famous Hollywood Producer (FHP) and infamous starlet-interviewer, but about inflation in prices, and why it is so bad, and I’ll venture a guess that this “inflation in the money supply causes inflation in prices” is lurking somewhere behind the new Labor Department news release that wholesale prices jumped 1.4% in January, the JOC-ECRI Industrial Price Index jumped 2.5% in One Freaking Month (OFM), and is now 78.17% higher than this time 12 short months ago! Yikes!

The mind screams, “We are freaking doomed!” and if you are like me, your throat clenched in primal fear, also screams, “We’re freaking doomed!” And if you are, again, like me, people turn around and yell at you for your timely warning, saying things like, “Shut up! We’re trying to get some work done here, you moron!” and, “Everybody shut up! I’m on the phone here, you idiots!” and then there is a big brouhaha and everyone is shouting, “You shut up! Who are you calling an idiot! You’re the idiot!” and, “You talking to me? You calling me an idiot, you moron?” back and forth and back and forth.

So I know what you are going through, but at least you know that you should put your money into gold, silver and oil, and thus you can just smile to yourself knowing that, one day soon enough, these morons are going to be busted out by the inflation in prices that will come from the inflation in the money supply that came from the Federal Reserve creating the money so that the government can borrow the money and spend the money, and that the inflation will ruin them utterly, although you will probably never learn of it out on your yacht, or at the country club.

The pleasure will come from the money, and the money will come from investing in gold, silver and oil, with the secret pleasure of Schadenfreude thrown in free!

The Mogambo Guru
for The Daily Reckoning

The Daily Reckoning