INFLATION
This Is the Real Reason The Dollar In Your Pocket Will Be Worth 20 Cents in 3 Years
The cost of living is going up, the money in your pocket is going down — and it's your fault
We are all in for a smack in the face.
Whether you are skint, have money saved for your retiral, or are lapping it up in luxury, in three years’ time the pound, dollar, or shekel in your pocket will buy a fifth of what it does today.
Who is to blame?
The Bank of England blames the actions of Russia. Republicans blame Biden. The Democrats blame Trump. The pro-Europeans blame Brexit. And we all have a go at greedy companies and their excessive corporate profits.
We are in a recession. As higher gas and electricity prices kick in, we will all feel the pinch. We will all have to tighten our belts. Many will have to punch another hole in them.
We can connect many reasons for the world’s current predicament: China, climate change, Ukraine, drought, COVID, and Russia. It’s the perfect storm.
But there is another reason for inflation that no one mentions — that reason is you.
It’s all your fault
Everyone is hoping the pace of inflation we are seeing right now will slow down — nobody knows when. It might be three years, as I suspect. It might be longer. However, It’s a nasty necessity. We need to make our money worth much less.
Inflation won’t rein itself in until the dollar in your pocket will only buy what 20 cents does today.
You want higher wages. Companies need to charge more. Governments need to tax more. That puts prices up. It’s absolutely fair that you get paid more to cover those spiralling prices. No one would disagree with you. You aren’t being greedy or unreasonable.
But you also wanted better services: more nurses, better education, new infrastructure, safer roads, your bins emptied, investment in renewable energy, affordable housing, money if you are unemployed, and an index-linked state pension.
And you have more money than ever. You are spending more and more. You want more things: cars, TVs, smartphones, an air fryer, holidays, yachts, fancy chocolates, flavoured gins, motorhomes, blended iced coffee frappuccino (FFS).
Businesses can’t keep up. All of your money is chasing a shortage of stuff, and that is cashing out as inflation.
During the pandemic, you bought lots more stuff. Now that you can get out and about again, you want experiences. You want to eat out, go on holiday, drive fast cars, and party like it is nineteen-ninety-nine.
You are consuming and experiencing so much more than your ancestors. Remember when you were a kid, and you went to visit your grandad and grandma?
Were they in?
Of course, they were.
Nowadays, kids don’t know where in the world their grandparents are — they might be on a cruise, crossing Europe on the Orient Express, or bungee jumping naked in New Zealand.
Your grandparents had to walk to the local shop to buy you a bag of toffees. Nowadays, they click a few buttons, and the next day you receive delivery of handmade Lindt frog chocolates all the way from Switzerland.
Your biggest mistake, however, is voting for power-hungry politicians who promise you the earth — and they are giving it to you.
The never-never
There is something broken in our economies. Take America, you can look at their published national debt.
$486,887,855,914,765
In the time it took me to type that number, their national debt rose by $500,000,000.
The American government, like Britain, Germany, Italy — every other country in the world — has borrowed money like there is no tomorrow. And they are probably right, there will be no tomorrow one day.
When our governments print money, we ignore them. We are blinkered. We have no concept of the rising debt. But we shouldn’t ignore it if we want stability. It’s a trap.
You, the taxpayer, are responsible for that debt.
Every taxpayer has to bear the heavy accountability for the accumulated debt. In America, that equates to just short of $1 million. Can you pay that back?
Why we need inflation
It is going to be hard on everyone, especially those operating near or below the living wage. People will go cold or hungry or both.
But if inflation doesn’t happen, we will enter a situation where the entire income received by our governments will not be enough to service their accumulated debt.
There will be no money left for hospitals, police, defence, or any of the other myriad of things that wouldn’t happen without good governments.
The debt needs to be paid. There is no magic money tree. There is only a small percentage of people who could dip into their savings to pay off their share of their country’s debt.
In three years’ time, you will moan about the cost of a bag of toffees, you will groan when you pay your gas bill, and you will vote out politicians who don’t promise you the earth.
The dollar in your pocket won’t buy you the same shit you can buy today. The packet of toffees you pay $1 for today will cost you $5 or there will be 80% fewer chews in the bag.
The good thing is that your country’s national debt will also be more manageable and you, the taxpayer, can rest a little easier when you go to your grave.
And then you will turn in it as your children repeat the same mistakes you did.
In one major fell swoop, Malky was single-handedly responsible for increasing the professionalism in Police Scotland — by retiring.
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