64 trillion! Severe inflation is coming to the United States. A new storm is brewing
Up up up!
Severe inflation is coming to the United States.
On June 15, there was disturbing news from the United States: the printing of money in the United States has finally ushered in significant inflation!!
America's inflation rate in May hit a 13-year high of 5%, well above the 2% threshold tolerated by the Federal Reserve.
You should know that in 2008 when the SUBPRIME mortgage crisis broke out in the US, the CPI was only 3.94%. If you pull the time to nearly 30 years, you will find that the US CPI generally maintained around 2%; even during the Iraq war, the US CPI was only 3%.
How much psychological impact should the unprecedented inflation have on the American people?!
If macro data is abstract, let's look at the prices of all kinds of goods in American supermarkets.
According to the investigation of American journalists, the daily necessities in American supermarkets, from food, used cars, gasoline to wood, are all going up in price.
A year ago, bacon is up 19 percent, bread is up 7 percent, oranges are up 9 percent, coffee and bananas are up 2 percent, and gasoline is up 56 percent!
Consider another American statistic:
Airfares are up 9.6%, petrol prices up 11%, electrical appliances up 15%, used cars up 21%, corn up 44%, beef up 100% and Chinese chives up 130%.
Most of the old United States angry is their heart good - roast chicken wings, also in the crazy price, which makes a lot of people out of anger, scold export.
"Chicken wing originally thief expensive, rise again, where is the justice?"
What's worse, in addition to household goods, house prices and rents in the US are also going up like crazy!
House prices have risen 19% in the past year; The median price reached $319,200, the highest level since 1989.
US rents rose 5.4% in May from a year earlier, also a record high.
All these significant price increases are concentrated in a short period of 1-2 months, which is even worse for those Americans at the bottom whose incomes have not increased but decreased.
This is not, inflation, rising prices now has occupied the United States every primary website and become the most popular comments!!
An even more significant inflation storm may be coming to America!
Why is inflation so rampant in the US?
The bottom line is that since the outbreak of COVID-19 in 2020, the US government has been recklessly releasing water.
How much money has the Fed printed in the last two years?
In March 2020, the Size of the Fed's balance sheet was about $4 trillion. By May of this year, it had reached $8 trillion.
The Trump era was around $7- $10 trillion. Biden went even further and printed another $6 trillion.
In other words, within a year, the Fed expanded its balance sheet by more than 50 percent, printing about $10 trillion, or 64 trillion yuan.
This amount of water, equal to the GDP of two Japan and three UK, is far more than the foreign reserves of China for decades; other countries earn income for years and decades, the United States can easily print directly.
Since the reform and opening up, the Chinese people have worked hard for more than 40 years, and the total foreign exchange accumulated is only 3.2 trillion US dollars.
It's not enough for the U.S. Government to spend six months.
A large amount of money is always reflected in the price; such a large amount of money will not cause significant inflation.
According to Nordea Bank, inflation in America could rise to 6% in the next two months, severe enough to stoke social tensions.
Even Donald Trump took the opportunity to make his presence felt, vowing to return to the White House in August as if he wanted to save The lives of The American people.
Seeing this, the US government is really on edge!
But what if you can't sit still?
The American approach, in a nutshell, is to ignore our heads and our butts. We're in a crisis. Get high and get through it.
Some may ask why it was ok for the US to print money before, but not this time.
The answer lies in China, as well as India.
It used to be that when the US printed money, every major country in the world had to do the same, or it would be harvested. Take China as an example. China is a prominent exporter. Foreign trade is significant to China.
But this time, China has chosen to fight the dollar instead of following America's lead and printing yuan. On the contrary, since the outbreak of rampant INFLATION in the US, the renminbi has risen rapidly against the dollar.
Why isn't China playing along with the US?
China is the first country to overcome the epidemic, and its manufacturing sector is recovering. China produces a large part of the world's epidemic prevention products and materials.
Since late March this year, India has been struck by a new round of "epidemic tsunami" and pushed to the brink of collapse.
The world is waiting for China to make, need to put in here, The export of Chinese goods in the short supply situation.
Even if the yuan appreciates, things will sell.
So, why lower prices?
Therefore, it must be said that this time the United States released water, thought initially to harvest, but did not expect the flood to pour back; instead, their own dragon King temple was washed down.
I'm sorry, that's impossible! This time, the American people also know, since the water harvest can not play, if continue such crazy water, may be caused by an economic crisis.
Instead of shutting down the gates, The Americans began gradually tightening money to drain liquidity.
After its June 17 meeting, the Fed raised the interest rate on excess reserves (IOER), the upper limit of the federal funds rate range, by ten basis points to 0.15 percent. It raised the overnight reverse repurchase rate, the lower end of the fed funds range, by five basis points to 0.05 percent.
Two initiatives, both are recycling action.
The boot we've been waiting for is about to hit the ground.