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 inflation has it gone away is it here to stay what are its effects and how does it lie to us I found this great chart on stocksera dot pythonanywhere.com entertaining name and right at the top there's an inflation chart going all the way back to 1960 and this is annual year over year inflation and you can see this upslope in the 70s and then this plateau in the 80s and 90s and then a lower Plateau after the global financial crisis and the Raging inflation that we've had since but it's nothing

compared to the 70s I remember the 70s a bit I was young I was but I was going to work and uh and inflation made things tough it really did I could sense anxiety in my parents and you know just having businesses my father always had his own businesses uh trying to keep ahead of things very very difficult trying to keep your pay uh you know what you're making up with what everything is casting so if we scroll down to the bottom here this is great it's a heat map it's called and you have uh each

year the month by month inflation rate over that month the previous year so it's year-over-year inflation and you can see that during the first half of the 60s there's no two percent inflation in here this was actually a Great era even though stuff was happening like November 22nd of 1963 John Kennedy was shot and then we had Martin Luther King and Bobby Kennedy and then Lyndon Johnson was uh president and during his presidency we really ramped up the Vietnam War and that can that escalated more under

Nixon and uh all of that came back to haunt us that currency creation of these waves you can see it climbing uh from one the one percents twos four five six it's very quick sometimes times and then 73 let's go back to 71 because in August of 71 here at 4.6 percent we went off of the Bretton Woods system decoupled from gold and that allowed us greater deficit spending and massive currency creation and uh what you see here immediately his inflation goes down for you know a year you know here's 2.9 percent from

4.6 one year later uh but then it starts creeping up again and uh Gerald Ford became president I think right there and uh it was you know going from 10 no it was August so 10.9 he became he became president 11.9 12.1 12.2 12.3 well as you'll see in a moment best thing to do when inflation gets high come up with a slogan [Laughter] 75 in fact we'll just jump to that right now so Ford's slogan was win whip inflation now and they came out with these buttons you could get them at the grocery store whip inflation now they

were everywhere it was on banners and stuff and because it was time to fight back against inflation and recession and everything else you know I sort of liked Ford because he was he was President for less than two and a half years so he didn't do anything the best presidents are the ones that don't have the time to change the rules on business to change the rules on everybody uh to change the amount of deficit spending to get a whole bunch of bills passed and stuff when that happens uh it just you know

every four years businesses have to adjust to some completely new environment that may be good or bad for them you start a business uh thinking that oh this is a great thing to do Under This economic environment that I'm in and then for years later it's a completely different economic environment and even George Harrison got in on the ACT here's Ford's win button over here this must be a button that George gave to him or something but let's get back to uh the chart of inflation then we went into this raging

inflation uh and there and Reagan became president and uh and then uh Paul volcker came in and raised rates incredibly high but here we are 14.8 percent inflation you may as well you know that the CPI uh doesn't take into account uh the financial markets and real estate and a whole bunch of other things where currency that you create can go but every dollar must go somewhere and so something inflates whether it's savings or whether it's retail prices or whether it's the stock markets or whatever something has to

inflate when they create currency and uh so uh then Paul you know Paul volcker got this under control by raising rates really high and then uh we go into the Greenspan era and it's still coming down and we do have some twos in here but this two percent inflation Target that the FED has how often have we actually been two percent or under they're scared to death of when it goes way under and it did dip you know here's minus 2.1 during the global financial crisis so this is uh actually this is mid 2009 uh but look at

how the inflation was accelerating into the global financial crisis and then once it happened 5.6 5.44.9 3.7 1.1 just a few months and then point one zero uh so uh it sores going into this party blow-off top and then uh comes back down and then we saw this again 20 you know we had the pandemic here 2020 and we went down during the lockdowns into almost no inflation whatsoever and then as uh some of that currency started with so as you know we still had lockdowns in 2021 but not that much they were really

lifted uh late I can't remember exactly when late 2021 early 2022 and you can just see this suddenly soar and uh 8.3 8.5 percent 9.1 and now it's back down but is it going to stay there uh so you know what are the effects and how can this lie to us the effects are since August of 7 of 71 since we left the Bretton Woods system which was the last vestiges of a fractional gold standard but still gold put some sort of constraints on deficit spending and currency creation so from then until today

it takes a dollar today with that or which only took 13 cents to buy the same amount like a dollar candy bar I can't think I was trying to go what costs a dollar what what is there that costs a dollar well there's got to be some candy bars or something that cost just one dollar but very few things cost a dollar today I couldn't even think of something but that is an 83 percent loss in purchasing power just since 1971. um when you take it all the way back to uh the Inception of the Federal Reserve

it's uh greater than a 90 it's it's a 90 uh seven percent loss in purchasing power since the Federal Reserve was created according to the CPI calculator in fact I'll do it right now we'll go uh let me see if well I'll just go January 1913 because it does go back that far and we'll see what it says three cents so three cents then could buy what a dollar buys now um so here's food inflation uh around the world world of statistics and like Lebanon Venezuela this is these are

crisis levels in all of these countries and the United States is down here at 8.5 but where did that 8.5 you know they created currency somebody created currency somewhere whether it was the banks or whether it was the Federal Reserve currency was created it it went into circulation and diluted the currency Supply uh so it it robbed anybody that was actually holding currency but if you didn't get a raise in the in the period of time that we've had this inflation if you didn't get a a

raise during that time to match it also stole from you even if you didn't have if you weren't holding on to currency if you didn't have assets that respond to inflation such as gold um that kept ahead of it such as gold has uh then uh your you know you're you're falling behind and that purchasing power was stolen from you and given to somebody else by the Federal Reserve by their policy by the Banks so Yellen says she has no plans to lengthen the maturity of U.S treasury issuance

now this is old this goes back to March of 2021. why did I do that I just wanted to see if these people actually have a clue to what they're doing so here we are today uh and we're at a yield that the treasury has to pay 3.8 percent on 30-year bonds and they've got to pay even more on these short-term ones but uh to get the FED Fed rate up there somebody has to they raise these rates somebody has to buy those at a high rate and a lot of times that is the Federal Reserve and Banks need those short-term

bonds and such but let's go back to March of 2021 and in um we can go month this is week by week so we're going week by week and April and May and June July so it's down it's it's down at two below two percent here and I'm talking about the 30-year treasury so you could Finance the government for 30 years at less than two percent and then it starts to take off and then you're going to see that they start raising the short-term rates so they're doing the rate increases but

now we're up at three three and a half an hour up at four percent so that's for the 30 years so it's too late to like buy those and uh and have the U.S paying a low percentage on its national debt for years to come um she said she actually said that it's unbelievable how clueless all these people are so anyway there are the raids uh then Yellen blaming consumers for inflation that's the government's latest tactic this is also pretty old it's uh from December of uh 2022 but I'll tell

you what uh this is really actually quite funny to watch it's it's uh people wanting to buy stuff that's those nests those nasty consumers that are causing all of this inflation it had nothing to do with the band that you know M2 is mostly created by Banks but the Federal Reserve and the banks and its Federal Reserve policy and uh their their uh the loan requirements that are set out and and so on that uh causes the banks to do what they do uh if the Federal Reserve relaxes loan requirements there's more

loans made and this explodes uh I didn't show currency in circulation or base currency that's not as much of a factor here base currency is a factor when it comes to the stock market and bonds and financial assets but you can see that this exploded by basically 40 percent what I've done here is I've indexed this to the beginning of the pandemic so this recession that started when uh Powell created all of this currency they added 40 to the currency Supply and then try to blame it on the consumers uh this is

It's comical they are just so incredibly clueless and then they're slamming rates up and really hurting us some people and benefiting other people and it's causing this enormous wealth transfer it's stress on certain businesses that are putting it's ruining people's lives puts people puts businesses out of business and when you're a small businessman that just saved up or borrowed from a relative to open up a business and then the FED changes policy and has your head

spinning and you lose everything because of it so what are the effects this is M2 this is M2 adjusted for inflation real M2 now take a look at the deflationary collapse that we're having in M2 right now measured in dollars this is the collapse measured in inflation-adjusted dollars and it's it's it's enormous compared to the and so what I did I indexed these here is the whole thing going back to the beginning uh and I've indexed them at the beginning of the pandemic and you can

see that when inflation took off M2 real M2 the the purchasing power of all of those dollars starts to fall long before it was like nine months before anybody was talking about well M2 is collapsing so you zoom in on this and as you can see real M2 actually started falling the value of the digits that are in bank accounts the the ious that the banks create that are backed by more ious that's a longer story there will be a video out on that shortly but that that peaked in December of 2021 and uh the

nominal uh M2 the the M2 that is the number of dollars that are out there really didn't start falling until after August of 2022. so a big huge delay here and that this is all uh stolen purchasing power due to inflation uh every the difference between this and this was stolen and it did go somewhere that purchasing power comes at the expense at somebody's expense if you didn't get a raise during this period of time to keep your purchasing power up to the level that it was uh earlier then uh

these excess dollars that they created uh stole some of your purchasing power and bestowed upon somebody that may have uh stocks their portfolio and stocks and it's going up hugely um and so anyway this is gross domestic product uh and so this is year over year change year-over-year growth or contraction in GDP and you can see sort of an average a little above five percent back in the 50s and in the 60s it's up at about seven percent then it goes up to 10 percent in the late 70s 10 11. uh there's 14.7 percent GDP increase

and it sounds great uh however you know and then uh in the early 2000s we were at uh six percent and then at four and a half percent roughly five percent four and a half percent uh in the after the global financial crisis and now we are up at seven percent growth and that sounds wonderful until you adjust it for inflation and then it comes down and you see this is actually uh just about like two and a half percent average or a little over two uh even back in the 70s when it was showing ten percent growth

that was 6.5 in that area and uh and then you can see how negative this goes sometimes and when you cut off all of the Peaks and fill in The Valleys you can see that the average is probably somewhere around um four percent there uh and it was about um two percent here you've got 1.3 to 3.6 yeah it's about the average here is about two percent uh after the global financial crisis so we shrank from uh four percent then three percent then two percent and today instead of that seven percent growth we have 1.6 inflation

adjusted uh that is how we get robbed and how how we get lied to uh this is the difference between the two um and then we've got people seeking safe havens now the financial crisis that we just had the uh the banking crisis uh Silicon Valley and stuff that started in late March that was here this had already started this flight from cash and checking accounts to uh cash in Money Market funds so this was going up and it went up huge we're talking about going from a trillion dollars uh to

1.444 so 1.5 trillion dollars uh so that's a 50 percent increase that is huge uh and so where did it come from probably from here except it doesn't show it the FED isn't reporting that yet this is supposed to be quarterly data it says that it was updated June 29th of 2022 so about a year ago uh yet it's it's only reporting q1 of 2022 when it was updated about um a year ago why aren't they updating this anymore and is this going to be marked discontinued like so many Federal

Reserve data sets have lately once people are looking at them because this is probably where it's coming from that's going down so this is q1 of 2022 if we go back to the money market funds and go back to q1 of 2022 so it ends down here in this trough so all of this rise this 50 percent rise and uh billions of dollars so this is you know it's half a billion dollars almost that uh has gone in to money market funds where did it come from it probably came from this 1.3 trillion so this has gone

down hugely most likely now I want to show you the Federal Reserve bringing us in for a soft Landing so this is like chairman Powell uh talking to all the other fed government Governors and the banks and everything and giving there and them their instructions and they bring us in for a soft Landing here and so they're navigating the course and this is a soft Landing [Laughter] you always so read this caption I want to thank you for watching click like And subscribe subscribe and we'll see you next time