Various economic commentators, the best known being Lawrence Summers, have been calculating the increase in disposable income “printed” into American households during the past year, and have concluded that it has roughly doubled household spending – if stock market speculation is included as spending. This means of forced inflation was called for in the “regime change” proposals from BlackRock, Inc. executives and other bankers at the Jackson Hole, Wyoming, Federal Reserve annual meeting in August 2019; ironically, Summers at the time strongly backed it in Twitter postings although not attending that conference. It is worth contrasting to China’s monetary and fiscal policy over the same period.
The latest calculation of this kind is by David Stockman on March 13. Stockman’s given figures may be imprecise but two things are clear. First, the replacement of household income by government grants and credits will have been much larger than – between two and three times — the loss of wages and salaries in the 2020 economic collapse triggered by the pandemic, which totaled roughly $300 billion. Second – and this is the inflationary trigger — a large part of these “emergency relief” funds will have gone to households which did not lose wage and salary income, since that loss was concentrated among lower-income households. Under zero interest rate conditions, forced by nearly $3 trillion in new excess bank reserves created by the Federal Reserve during the same period, these printed funds were largely spent – on extra purchases and on speculative investments. The inflationary results are now showing, from the price of motor vehicles and houses, to the price of stocks.
This is, literally, the “regime change” formula from Jackson Hole.
