By Graham Summers, MBA
Yesterday, I outlined the dark truth about the economic shutdowns of 2020.
That the shutdowns have unleashed an inflationary tidal wave.
Central bankers have been trying to create inflation for years. They’ve printed over $20 trillion in new money. And they’ve cut interest rates over 800 times. But inflation never fully showed up.
Then we shut down the economy and BOOM! inflation appeared.
Because shutting down the economy damaged/broke supply chains. And forcing people to stay home while scaring the heck out of them with a virus made them decide to not go back work even when the “all clear” was signaled. In any parts of the economy (coal mining, oil and gas, shipping/ trucking, etc.) people have decided to change career paths entirely.
As a result of this, today we are facing both a supply chain crisis and a labor shortage.
BOTH are inflationary.
Because both mean fewer goods and services are available.
Meanwhile, demand is returning to normal as the economy reopens. In some areas, demand is exploding higher as people have decided to stop putting off their dream purchases due to the “You Only Live Once (YOLO)” mentality the shutdowns helped foster.
Regular Demand + Fewer Goods and Services =HOT INFLATION
The craziest thing about this whole mess is that the same policymakers who created it, can’t do a thing to fix it.
The Fed, which has printed over $4 TRILLION to prop up the financial system can’t print new workers keen to return to work, keeping interest rates at zero doesn’t make oil prices come down, and spending hundreds of billions of dollars on QE per month doesn’t result in cargo ships being unloaded and life returning to normal.
Similarly, the DC crowd has no idea how to fix the mess they made.
The Department of Energy Secretary, the highest official for the energy industry in the U.S. doesn’t even know how many barrels of oil the U.S. consumes per day. The Secretary of Transportation is on paternity leave during the single greatest supply chain crisis in decades. The President thinks releasing 50 million barrels of oil from the Strategic Petroleum Reserve (SPR) over several months will lower gas prices… when the U.S. consumes 22 million barrels of oil per day.
It would be hilarious if it wasn’t so tragic. And the reality is that it has unleashed an inflationary storm that is giving investors a ONCE IN A LIFETIME opportunity to get filthy rich from government incompetence.
During the last major bout of inflation in the 1970s, smart investors locked in gains in the QUADRUPLE digits (1,000% or higher). And THAT version of inflation was the kind the Fed could stop!
So you can imagine the profit potential of this crisis today.
I outline five investments that could explode higher as inflation rips through the financial system in a Special Investment Report titled Survive the Inflationary Storm.
To pick up a free copy, swing by