You need insurance for current inflation

xuanling11
Coinmonks
Published in
2 min readSep 2, 2022

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Photo by Scott Graham on Unsplash

Inflation is a myth if you try to blame everyone else rather than the central banks.

There is no way to reduce inflation if the government keeps spending more money.

And there is no way to cut back expenses from the government at the current spending level.

The TRUTH is…

The central bank cannot bring down inflation this time. The monetary policy is clearly not working if the government continues to spend far beyond its means.

The result of the high inflation will bring us into stagflation.

When fiscal imbalances are large and fiscal credibility wanes, it may become increasingly harder for the monetary authority to stabilize inflation around its desired target. If the monetary authority increases rates in response to high inflation, the economy enters a recession, which increases the debt-to-GDP ratio. If the monetary tightening is not supported by the expectation of appropriate fiscal adjustments, the deterioration of fiscal imbalances leads to even higher inflationary pressure. As a result, a vicious circle of rising nominal interest rates, rising inflation, economic stagnation, and increasing debt would arise.”

Here is the research paper published by the Fed.

What beyond the truth?

Controlling inflation is so very difficult to impossible!

Every era of the government has failed to do so without any exceptions!

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