Posted on 06/26/2021 3:38:30 PM PDT by blam
It may not be quite hyperinflation – loosely defined as pricing rising at a double-digit clip or higher – but if former Treasury Secretary and erstwhile democrat Larry Summers is right, it will be halfway there in about six months.
One day after Bank of America warned that the coming “hyperinflation” will last at least 2 and as much as 4 years – whether or not one defines that as transitory depends on whether one has a Federal Reserve charge card to fund all purchases in the next 4 years – Larry Summers, who is this close from being excommunicated from the Democrat party, predicted inflation will be running “pretty close” to 5% at the end of this year and that bond yields will rise as a result over the rest of 2021.
Considering that consumer prices already jumped 5% in May from the previous year, his forecast is not much of a shock.
Speaking on Bloomberg TV, Summers said that “my guess is that at the end of the year inflation will, for this year, come out pretty close to 5%,” adding that “it would surprise me if we had 5% inflation with no effect on inflation expectations.” If he is right, the recent reversal in one-year inflation expectations which dipped from 4.6% to 4.2% according to the latest UMich consumer sentiment survey, is about to surge to new secular highs.
This is not the first time Summers has predicted that the firehose of fiscal and monetary stimulus will unleash soaring inflation. While career economists at the White House and Fed – who have peasants doing their purchases for them – urge Americans to ignore the current hyperinflation episode, saying that the recent inflation surge will soon pass, Summers has been unique among his fellow Democrats in predicting that massive monetary and fiscal stimulus alongside the reopening of the economy would spark considerable price pressures.
Asked how financial markets may behave in the rest of 2021, Summers said “there will probably be more turbulence” as traders react to faster inflation by pushing up bond yields. “We’ve got a lot of processing ahead of us in markets,” he said.
Ironically, Summers – who now teaches at Harvard University whose president he was not too long ago when he hung out with his buddy Jeffrey Epstein…
… also praised President Joe Biden’s tentative deal with a bipartisan group senators on a $579 billion infrastructure plan (which has virutally no chance of passing) and echoed the White House’s call for even more to be spent on “human infrastructure.”
“There is a lot that is left to do that should be supported,” Summers said. “The investment will strengthen our economy.”
Treasury Secretary Janet Yellen told lawmakers this week that she expected annual inflation to be below that level by the end of this year.
Putting the stimulus tsunami in context, on Friday Bank of America’s Michael Hartnett calculated that with the latest $600BN Biden infrastructure plan, the running tally of global monetary & fiscal stimulus rises to $30.5 trillion in the past 15 months, an amount equivalent to entire Chinese & European GDP’s.
Summers is no longer president of Harvard because of this:
“hyperinflation – loosely defined as pricing rising at a double-digit clip or higher “
Wrong
Hyperinflation is caused by creating money out of nothing and pushing piles of it into an economy, therefore “pricing rising” is a misnomer. It should be called “devaluing the currency’s.
Larry’s pretty optimistic.
We can see much higher increases than 5% already ourselves.
Maybe skateboards, video gamer chairs and stamp collector supplies went down but bread, facial tissue, paper towels, toothpaste, soap, shampoo, peanut butter, pickles, fresh fish, chicken and beef, and hundreds of other items went up noticeably.
I happened to have an old receipt to keep taped to a product box in case of using the warranty for an item from 2 years ago. The prices on the grocery items along with it were shockingly lower. Often 50 cents or 75 cents lower an item than now. Canned goods and coffee maybe 15% lower then. The good old days.
I won’t mention the GAS it took to drive to the supermarket. You’re welcome.
Inflation will be clocking 15% by the end of the year, and 25% next year if somebody doesn’t shut the money spigot.
Our children and grandchildren will have to live with Biden’s unsustainable debt.
New Stimulus Checks Could Start Hitting Your Account Automatically
He needs some new glasses. So he can see what is in front of his face. Food prices are skyrocketing and container sizes are shrinking.
Remember Trump saying last year in 2021 he would break records in the economy and jobs again - and he would have - and instead we get this crap.
If it’s five percent I’ll throw a party.
Try 15 to 20% Larry...
It’s not like the debt will ever be paid.
It is certain it will not be.
This guy is always wrong..so expect deflation
You save your whole life to take care of yourself in old age and then they wipe it out of a few years.
Disgusting.
That is so.
Larry sees booty
Me too
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