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Part
I considered inflation as a disease of the human condition, and that once it
starts, the course it runs is unstoppable, and how in its early stages its a
great party. Part II revealed the similarities of inflation to "The Great
Pox" of syphilis, and then how it has mutated to present, with different
symptoms. Money pumping and cheap goods from China disguise the present
epidemic.
We
are in the buoyant phase at the moment, with constant reminders that "there
is no danger of inflation". We'll hear this more and more, and then a few
brave establishment souls will start asking, "Do we have inflation?"
Finally, when even our political masters start to get the message, we’ll have
a respectable economist breaking ranks and saying: "Errrr…..It looks like
we have inflation."
It
is then that the disease will be starting to enter its terminal phase. The
financial spirochaete (Treponema pallidum) will be munching on the economy's
nerve center, and spitting out any motivation to effect a cure.
In
the "good 'ol days", if you survived the chancres, and the involvement
of about any organ you can think of- heart, kidneys, eyes etc, you went mad.
History is littered with examples. It was thought by some that Friedrich
Nietzsche had the disease. Fried rich
is not healthy eating ) With him, this terminal phase ( neurosyphilis) mimicked
catatonic schizophrenia. It was thought that Nietzsche 's ideas drove him crazy,
but perhaps not.
This
stage of syphilis was called "General Paresis of the Insane". This was
a plethora of debilitating symptoms including hallucinations, delusions, memory
loss, and loss of judgment and insight.
Perhaps
this is with us now? We appear to have lost our memory of what expansionary
economics will do in the long term, of how all booms will bust. We like to
believe what we are told. "Don't worry about borrowing 100% of your new
home's value- your wages will go up" or
"we'll engineer a soft landing".
What
does a financial soft landing look like? I've never seen one after a boom!
The
paresis part means you lose the ability to move. Like a rabbit caught in a
car’s headlights at night, it knows what fate awaits but can't move. Financial
paresis is just like this in The Great Financial Pox’s terminal phase.
Who
wants to save when savings have their value devoured by the pox's ravages? Who
wants to work when last week's wages can't buy next week's food?
Next
week, Part IV, will be the last in this mini series. We'll look at some specific
inflation - busting strategies. It starts with when to leave the party and then
a bit on practical personal salvation from The Great financial Pox.
Our
national fate is already sealed.
John
Tyler,
Aka
“The Infognome”
www.infognome.com