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To: Pelham

If one reads the FOMC’s press releases and minutes one would certainly get the impression that they do blame wage growth for inflation. In reality, inflation is caused by currency devaluation, but you’ll never catch the Fed pissing off their Big Government and Big Business overlords by saying it.


10 posted on 03/11/2015 9:28:16 PM PDT by Moonman62 (The US has become a government with a country, rather than a country with a government.)
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To: Moonman62

There is something called ‘wage-push inflation’ and maybe you were reading a press release that was discussing that.

An example of wage-push inflation would be an increase in the minimum wage. A wage increase of that sort isn’t accompanied by a productivity increase so it simply pushes up the cost of labor for the same amount of work.

You will pay more for the same hamburger or anything else that has a labor input. Minimum wage earners will feel like they got ahead for maybe a year but prices will all adjust up so that it won’t be long before their real earning power is right back where it started.

The people who really get screwed are retired people on fixed incomes or people living off their savings.


13 posted on 03/11/2015 9:41:00 PM PDT by Pelham (The refusal to deport is defacto amnesty)
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