With the Money Supply (M1) up 358% since January 2020 (as of February 2021), there is simply zero percent probability that prices are not going higher. A 3-4x increase in M1 ought to inflate prices by a similar multiple. Most of the recent $1.9 Trillion (the actual cost will be higher), COVID spending program was not allocated to COVID relief and will quickly be put to work by Government Agencies and their proxies on a variety of services at inflated prices. This next $3-5 Trillion Government spending program is not factored into the current M1 figure of $18.4 Trillion and will push M1 to the $22-23 Trillion range. This $3-5 Trillion tranche will also find a home across various goods and services pushing inflation significantly higher. Someone forgot to remind the Keynesians and MMT advocates who run global fiscal and monetary policy that money printing does not create a sound and vibrant economy. If infinite money printing and debt do not matter, why not print $100 Trillion every year? Why not mail every U.S. household a check for $100 million? Exactly. Ultimately we will have to pay the piper. That day has been significantly pulled forward given how the U.S. has accelerated the pace of debt-financed money printing since Q1 2020.
Here is that ugly chart. Click the chart to view the interactive version (click “Read More” if the chart does not render in your email client).