J.E.S: The Real Truth About Inflation
Tom welcomes J.E.S. the author of “The Real Truth About Inflation.”
Jes is trying to enlighten everyone about deeper economics and the causes of inflation. Most of us don’t fully understand the full consequences of these types of economic conditions. He’s found American’s to be the least educated around the topic of inflation. They’re somewhat numbed to how the world works due to the American dollar’s status.
Inflation is an increase in the quantity of currency supply. This is the premise by which inflation begins and is not to be confused with real money. Velocity is the circulation component of currency through an economy. It’s the rate at which currency changes hands. This rate sometimes creates an illusion that there is more money than actually exists. There are many variables to money velocity, and it’s difficult to get fairly determine it.
Price inflation is more common in currency based economic systems. Real money can’t be rapidly inflated because it’s tied to a resource like gold. Money is supposed to be an unchanging metric that is inherently useful at determining value. The problem with currencies is their unit of measurement is constantly changing, making it very difficult to determine true value.
He discusses how all countries issue debt, set interest rates, and control their currencies.
The dollar has fallen nearly 100% since 1913. In 1913 gold was worth around $22 an ounce; therefore it’s essentially lost all of its purchasing power. Today, we need so many units of them to match its historic value. Imagine if we changed the definition of a mile by 98 times. The U.S. dollar is losing all meaning.
Money is useful for constraining government’s ability to create debt. Today, total debt numbers are becoming increasingly meaningless as these numbers reach incomprehensible levels.
He explains the benefits of gold and the platinum group elements and why they are so useful for preserving value. These metals don’t break down or rust, unlike almost everything else in society.
The idea of the Fed having a two percent inflation target seems dumb on its face. They justify it by contrasting it against GDP growth.
We’re in a financial doom vortex that the average person can never get ahead of, and wages are unlikely to keep up.
Time Stamp References:
0:00 – Introduction
1:05 – Intended Audience
3:25 – Defining Terms
8:28 – Currency Vs. Money
13:24 – Rates & Distortions
19:47 – 1913 Dollar Vs. Gold
23:28 – Constraining Gov’t
28:35 – Rates & Size of U.S. Debt
35:46 – Countries & Default
37:57 – Why Precious Metals?
41:57 – Is the Fed Necessary?
48:23 – Recent Fed Printing
49:58 – Milkshake Theory
54:10 – Q.E. & Inflation Targets
1:02:17 – Inflation From Here
1:08:32 – Concluding Thoughts
1:14:52 – Wrap Up
Talking Points From This Episode
- Educating everyone to bring a more in-depth understanding of economics.
- Understanding inflation and how money velocity functions.
- The incredible decline in the purchasing power of the dollar since 1913.