Inflation is not just happening in the United States, it is a worldwide phenomenon. Why?
First, all fiat currencies are pegged to the dollar. Second, every country has been inflating their currency.
It is the creation of new currency units that devalues the purchasing power of all other existing currency units (forcing prices to rise aka inflation).
Yet, the world is being told that it is a “hot economy” that is causing inflation.
Hot economy? No problem, raise interest rates.
The FED did raise rates.
Results: Q1 2022 USA Gross Domestic Product (GDP) came in at -1.4%.
Can the economy be hot when it is in decline? No.
Continuing to raise rates into a weak economy will cause an inflationary depression (economy shrinks, unemployment increases, prices still rise).
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