Archive for November, 2021

U.S. Annual Inflation Rate Soars to 6.2% As Federal Reserve Engages In Deliberate Deception

November 10th, 2021 Comments off


The U.S. Labor Department has released its most recent official inflation report, which shows that the annual rate has now reached 6.2 %. This is the highest level of inflation in the United States in thirty years. It should be noted that official statistics on American inflation  are usually a lagging indicator. Likely, annual inflation in the U.S. is in the 8-9 percent range.

As noted on this blog previously, there are a number of converging forces feeding this inflationary spiral, which is afflicting not only the U.S. but the entire global economy. These include Covid restrictions that have reduced employment in key sectors, everything from shipping capacity to energy production and computer chip manufacturing. Then there has been the unprecedented flood of liquidity released by many central banks, in particular the Federal Reserve, which in this mix of lower productivity serves as a turbocharger of inflationary forces.

The policy of the Fed, up to the present moment, has been to claim that this inflationary spiral is merely “transitory.” No one believes this anymore; it is absurd to believe that the policymakers in the Federal Reserve believe their own lies.

Why is the Fed engaging in deliberate deception, while inflation is likely to hit double digits? It would appear that the Fed has concluded that the American economy is in such dire straits, it requires the life support of money printing (quantitative easing and monetization of public debt). Furthermore, the level of public debt is reaching the point of unsustainability, leaving  only two outcomes: the U.S Treasury defaults on the national debt or the real value of the debt is sharply diminished by high inflation. Of course , the Fed will never publically admit that it prefers inflation, even at a high level, than the alternative. This would involve sharply raising interest rates, leading to a sharp recession.

The danger of the Federal Reserve’s policy of deception and stealthily preferring high inflation is that it will lead to unforeseen consequences. Sustained economic growth along with political stability is incompatible with high inflation. Ultimately, the Fed policy will lead to stagflation, and eventually the Federal Reserve will be left with no alternative but to sharply raise interest rates, however in a more consequential manner.

Sheldon Filger-blogger for