The dollar is dying…Key Inflation Spike Largest In 30 Years As Middle Class Sags

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  Key Inflation Spike Largest In 30 Years As Middle Class Sags

( Hiram’s Note:  What does this signify? It signifies the fall of America. It signifies the decline of the dollar as the currency of choice and as the world’s reserve currency. It shows us that the power of the dollar is being broken completely. )

With a non-stop flow of propaganda from Western mainstream media outlets, today Michael Pento warned King World News that we have just witnessed the largest inflation spike in 30 years in one key area. Pento also discusses the implosion of the middle class as they continue to be systematically destroyed by inflation.

Pento: “Q1 GDP was only 0.1% in the United States. In that number is something called Nominal GDP, which is Real GDP plus inflation. Nominal GDP was reported by the government as 1.4%, which means that inflation in Q1 was running at a 1.3% annualized rate.

According the the Bureau of Labor Statistics, energy prices were up 3.3% year-over-year. Food prices as measured by protein, which is meat, poultry, fish, and eggs, were up 6.4% year-over-year. Health care costs were up 9.9% in the past year. That’s the largest increase in health care costs in 30 years..

“Home prices are also up 13% in the past year. The average American is getting eaten alive by inflation. The cost of living has skyrocketed in the past year for anyone eating proteins, or anyone who was paying for health care and energy. So taking a real inflation measure off the Nominal GDP print, you can clearly see that the U.S. economy is contracting right now.”

Source: http://kingworldnews.com

Pento added: “The reason we are in a further period of contraction is the government never allowed the economy to heal. Instead, the Fed used quantitative easing to inflate real estate prices and stock prices. This has served to destroy the American middle class. This also increased the wealth gap.

The tapering by the Fed is now halfway done. So we are going to start a new paradigm, which is really a resumption of the old paradigm, which is the healing process that began in 2007. This will mean a restructuring of debt and a collapse of old asset bubbles.

So tapering equals falling asset prices, which equals a contraction in the real money supply. This will lead to a healthy period of deflation and recession. This is where we are headed in the latter half of 2014. I don’t know how long that’s going to last. I think once the Fed admits we are in recession, they will start to reverse course and go back to the old habit of bailing out an economy that’s addicted to asset prices and inflation by vastly expanding the Fed’s quantitative easing program…..more here

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