Can the USA have inflation worse than the 1970s and 1980s?
(AdvancingTime Blog)
ZeroHedge posted the following by Nick Giambruno via InternationalMan.com:
From High Inflation To Hyperinflation: How Close Are We?
October 23, 2024
The Federal Reserve is now entering a monetary easing and rate cutting cycle in an environment of elevated inflation.
The last time this happened was during the 1970s, a decade that saw inflation spiral out of control. …
Despite elevated inflation, the Fed cut interest rates multiple times until 1972 to stimulate economic growth.
Inflation soared to over 12% in the months that followed.
In response to the rising inflation, the Fed raised rates aggressively in 1974, pushing the federal funds rate from around 5.75% to 13%.
However, as the economy entered a deeper recession, the Fed began cutting rates again in 1975 despite inflation remaining elevated at around 9%.
By the end of the decade, inflation had reached double digits again at over 11% in 1979 and peaked at 13.5% in 1980.
The raging inflation of the 1970s and early 1980s is a stark illustration of the danger of cutting interest rates in an environment of elevated inflation… such as the one we are in today.
However, as bad as the 1970s inflation was, I believe it’s an optimistic scenario.
That’s because the out-of-control inflation then was only tamed when Paul Volcker hiked rates above 17%… an option that is not available to the Fed today because of the skyrocketing federal interest expense.
In fact, the Fed could only raise rates to about 5.25%—less than a third of what Volcker had to do—before capitulating recently.
In other words, the higher the debt load, the less room the Fed has to raise rates because of the interest expense.
As the debt pile and accompanying interest expense grow exponentially, I am skeptical of their ability to hike rates to even 5.25% again; forget about higher than that.
Imagine what could have happened in the 1970s and early 1980s if Volcker could have raised rates to only 5.25% instead of over 17%.
This is the environment the US now finds itself in. …
it will take a lot more to push the US into hyperinflation.
I’m not saying that hyperinflation in the US is inevitable or imminent, though it remains a growing possibility. That is especially true as World War 3 plays out and a multipolar world order potentially emerges that could change everything.
In the meantime, I believe ever-increasing currency debasement potentially worse than what the US experienced in the 1970s—though not necessarily imminent hyperinflation—is an unstoppable trend you can bet on. https://www.zerohedge.com/economics/high-inflation-hyperinflation-how-close-are-we
Before the USA is conquered, more inflation is coming–and with devastating consequences. The situation will be worse than in the 1970s/early 1980s.
Here is something from my 2021 book, Biden-Harris: Prophecies and Destruction:
Joe Biden will have to deal with the fact that the U.S.A. is the most indebted nation in the history of humanity. Plus, he has pledged increasing it further [The Biden Emergency Action Plan to Save the Economy. JoeBiden.com, accessed 12/16/20].
Debt is a prophesied problem (cf. Habakkuk 2:6-8). But many in the media as well as politically-inclined economists do not see it that way—but that is too short sighted (cf. Ecclesiastes 8:11).
The time will come when the U.S.A. government will no longer be able to borrow at low interest rates and/or it will create more money electronically and/or via the printing press to try to continue.
Make no mistake about it — massive inflation is coming.
The U.S.A. dollar will ultimately crash and be worthless. That “pride” of American power will be broken (cf. Leviticus 26:19). …
Inflation will eventually hit the U.S.A. extremely hard. As the world becomes less attached to the American dollar, many financial jobs and opportunities will be in places other than the U.S.A. Eventually, but not yet, the U.S.A. dollar will become worthless (worth no more than the scrap or sentimental value of the cotton-paper it is printed on).
Note: The Trump-Pence Administration also increased debt, so quoting the above is not intended as an endorsement of Donald Trump.
That said, last century, in a 1981 article, the old Worldwide Church of God had this about inflation:
Notice some of the penalties for disobedience recorded in the 26th chapter of Leviticus: “If after all this you have not learnt discipline but still defy me, I in turn will defy you and scourge you seven times over for your sins. I will bring war in vengeance upon you … you shall be herded into your cities, I will send pestilence among you, and you shall be given over to the enemy. I will cut short your daily bread until ten women can bake your bread in a single oven; they shall dole it out by weight [see Revelation 6:5-6], and though you eat, you shall not be satisfied. If in spite of this you do not listen to me and still defy me, I will defy you in anger, and I myself will punish you seven times over for your sins. Instead of meat you shall eat your sons and daughters” (Lev. 26:23-28, The New English Bible). Other passages warn of famine-producing upsets in weather (Amos 4:7, Deut. 28:24); ruined harvests (Ezek. 5:16, Deut. 28:17); blighted crops (Amos 4:9); harmful insect pests (Deut. 28:39, 42); and nonproductive soil (Deut. 28:23). (4 Horsemen of the Apocalypse – The Black Horse – Famine. WCG booklet, 1976)
The Bible foretells that inflation at least in the sense of oppressively rising prices — will be a plague of the end times. Notice Haggai 1:6, “and he that earneth wages earneth wages to put into a bag with holes.” Every person who has seen the buying power of his money be continually eroded because of rising prices can well understand that that prophecy has already come to pass.
The book of Revelation also foretells inflation: “A measure of wheat for a penny, and three measures of barley for a penny; and see thou hurt not the oil and the wine” (Rev. 6:6).
A measure of wheat for a penny sounds like a bargain these days. But consider, a measure of wheat at the time John penned the book of Revelation was two-or three pints. A penny was the day’s wages of a laborer. In North America today, a factory worker’s pay is conservatively around $40 a day. So consider: three pints of wheat for $40!
That is inflation. Moreover, as we would expect from the time sequence, the prophecy bears a striking resemblance to our own pre-tribulation times: While food is scarce, it still has a market price.
The mention of oil and wine has several layers of meaning, one of which is an allusion to the practice in ancient Roman provinces of exporting oil and wine to Rome regardless of the scarcity of food at home. The main meaning, of course, is that oil and wine, having become scarce and expensive, must be spared for the highest priority uses.
When money fails
Biblical descriptions of money and prices bring out several important lessons about high prices:
Scarcity can make your money worthless. In Joseph’s time, when “famine [crop shortage] was over all the face of the earth” (Gen. 41:56), the fact was reflected in the price of food. Thus, when Jacob sent his sons to buy food in Egypt, he told them to take “double money” (Gen. 43:12).
Another example of scarcity-induced price increases was the siege in Samaria in the time of Elisha: “And there was a great famine in Samaria: and, behold, they [the Syrians] besieged it, until an ass’s head was sold for fourscore pieces of silver, and the fourth part of a cab of dove’s dung for five pieces of silver” (II Kings 6:25).
Today, silver sells for around $8.50 an ounce. Imagine! Over $42.50 for a small quantity of bird waste!
And, of course, the law of supply and demand works the opposite way as well. When the Syrians prematurely abandoned their invasion and left their provisions behind (II Kings 7:6 and 8), the inhabitants of the city went out and gathered up those provisions. Supply increased. And prices came down.
Inflation increases the power of those who hold tangible goods. In the time of Joseph’s famine, people had money, but no food. The price of food went up, and they soon ran out of money.
(Since money in the Bible was synonymous with a given weight of silver or gold (See Ezra 7:15-17, II Kings 12:10-11), the government could not just go and print up some more.) Thus their “money failed” (Gen. 47:15), and they had to barter their livestock for food (Gen. 47:17).
After they had bartered away their livestock, they were forced to barter their land and their labor. If they hadn’t possessed some tangible goods to barter after their money ran out, they would have starved (Gen. 47:19).
And in the end, because the Egyptian government had correctly “anticipated market conditions,” it ended up owning everything. A closely related lesson from this account is that inflation favors those who hold or produce tangible necessities (as opposed to luxuries). … Of course, since gold is regarded as a disaster hedge by many investors, prudence might dictate that perhaps a small fraction of your liquid assets be in gold …
The most important inflation hedge
Be righteous. God has the supernatural power to insure that His people do not suffer privation. God always has the power to hedge you from the ravages of inflation (see Job 1:10).
King David made this principle plain: “The Lord knoweth the days of the upright: and their inheritance shall be forever. They shall not be ashamed in the evil time: and in the days of famine they shall be satisfied … I have been young, and now am old; yet have I not seen the righteous forsaken, nor his seed begging bread” (Ps. 37:18-19, 25).
So, even though we do have a responsibility to provide for our children and our grandchildren through all the know-how and skills we can muster, in the end it is God in whom we must place all our trust, never wavering. That is the most sound investment anyone can make.(Calkins J. When Money Fails. Good News, October-November 1979)
Money, meaning the US dollar, will one day fail! And the USA will be taken over (Daniel 11:39) and be no more. Yes, we need to fully put our trust in God.
Other articles from the old WCG also predicted that the Europeans would end up with their own European currency (which it now has) and that it would be expected to replace the dollar (which is something that the Europeans want to happen).
The history of the US government increasing debt is setting the stage for more inflation.
The media and the populous will demand more ‘stimulus’ –which means more debt.
Sadly, many in the media and government act like printing up money is really the solution for the US economy because of their views of government and the economy.
But there is a real risk of massive inflation–and ultimately destruction.
Related to inflation, we put out the following video:
Inflation: When Money Fails
Inflation has been higher in 2022 than it has been for decades in the USA, Europe, and many other lands. What are some of the disruptions that inflation can cause? What about hyperinflation affecting places like Venezuela? Did the Book of Haggai predict inflation? Is food price inflation associated with the ride of the third horseman of the Apocalypse? Does sin and government mismanagement cause inflation? Are there physical things one can do about inflation? What about storing food or buying gold? Will gold outlast the USA dollar? Why might some throw their gold in the street as Ezekiel prophesied? What should God’s people do about inflation? What did Jesus teach about food worries? What about seeking the Kingdom of God? Steve Dupuie and Dr. Thiel cover these matters.
Here is a link to our video: Inflation: When Money Fails.
The Bible warns, “be sure your sin will find you out” (Numbers 32:23).
Sadly, the USA has no real intention to pay back its debt.
Its leaders basically hope to not pay it back, but if some payment is needed they hope that it will be in inflated dollars worth less than what the USA borrowed.
Foreign creditors will not be pleased.
Not paying back debt is wicked:
The wicked borrows and does not repay … (Psalm 37:21)
This diluting of the value of currency (called “dross” anciently), which is what the USA has been doing with its debt and quantitative easing policies, is condemned in the Bible:
4 Take away the dross from silver (Proverbs 25:4a).
22 Your silver has become dross, Your wine mixed with water. (Isaiah 1:22)
25 I will turn My hand against you, And thoroughly purge away your dross, And take away all your alloy. (Isaiah 1:25)
18 “Son of man, the house of Israel has become dross to Me; they are all bronze, tin, iron, and lead, in the midst of a furnace; they have become dross from silver. 19 Therefore thus says the Lord God: ‘Because you have all become dross, therefore behold, I will gather you into the midst of Jerusalem. 20 As men gather silver, bronze, iron, lead, and tin into the midst of a furnace, to blow fire on it, to melt it; so I will gather you in My anger and in My fury, and I will leave you there and melt you. 21 Yes, I will gather you and blow on you with the fire of My wrath, and you shall be melted in its midst. 22 As silver is melted in the midst of a furnace, so shall you be melted in its midst; then you shall know that I, the Lord, have poured out My fury on you.’” (Ezekiel 22:18-22)
Dross money causes inflation. There is a serious cost to having an economy pumped up with so much “dross” money.
Although the Bible warns against using dross and diluting the money supply, many modern ‘experts’ have a different view. The wrong views on economics will lead to economic problems and ultimately the total crash of the dollar of the USA.
Printing more money and contributing to hyperinflation is not going to solve the debt problems of the USA.
The USA, because of the role of its dollar, can look to get away with this for longer than other nations, but the end result will be much worse than most think.
There are disastrous changes that will come to the USA (Daniel 11:39; see also USA in Prophecy: The Strongest Fortresses)–and its debt and other monetary practices–which one day will cause massive hyperinflation–will be a cause (cf. Habakkuk 2:6-8; see also USA in Prophecy: The Strongest Fortresses).
But since many leading so-called ‘economists’ are political hacks and/or have a political agenda, do not expect too many prominent ones to have sufficient influence to resolve the problems in the USA.
The truth is that the USA is setting itself up for massive inflation and destruction.
Hyperinflation will hit the USA and its results will be worse than almost anyone realizes.
Some items of possibly related interest may include:
The End of US Dollar Dominance Is the USA losing its economic status? What about the petro-gold-yuan? A related video is also available: US Dollar being challenged by Gold-Petro-Yuan.
Physical Preparation Scriptures for Christians. We all know the Bible prophecies famines. Should we do something? Here is a version in the Spanish language Escrituras sobre Preparación física para los Cristianos. Here is a link to a related sermon: Physical preparedness for Christians.
The Plain Truth About Gold in Prophecy. How Should a Christian View Gold? What do economists and the Bible teach about gold? Gold and silver may drop in value. Inflation/deflation? What do Christians need to know about gold and silver? Two videos of related interest may be: Germany, Gold, and the US Dollar and Silver, Science, and Scripture.
USA in Prophecy: The Strongest Fortresses Can you point to scriptures, like Daniel 11:39, that point to the USA in the 21st century? This article does. Two related sermon are available: Identifying the USA and its Destruction in Prophecy and Do these 7 prophesies point to the end of the USA?
Who is the King of the West? Why is there no Final End-Time King of the West in Bible Prophecy? Is the United States the King of the West? Here is a version in the Spanish language: ¿Quién es el Rey del Occidente? ¿Por qué no hay un Rey del Occidente en la profecía del tiempo del fin? A related sermon is also available: The Bible, the USA, and the King of the West.
Biden-Harris: Prophecies and Destruction Can the USA survive two full presidential terms? In what ways are Joe Biden and Kamala Harris apocalyptic? This book has hundreds of prophecies and scriptures to provide details. A Kindle version is also available and you do not need an actual Kindle device to read it. Why? Amazon will allow you to download it to almost any device: Please click HERE to download one of Amazon s Free Reader Apps. After you go to your free Kindle reader app (or if you already have one or a Kindle), you can go to: Biden-Harris: Prophecies and Destruction (Kindle) to get the book in seconds.
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