Eric showed the above table in his presentation. It shows that the true level of inflation, a persistent increase in prices, has been sitting around 10% since 2011. Indeed, a far worse picture than what the US Federal Reserve paints. The Fed argues that prices have been rising below 2% for the past four years. That said, the Fed doesn’t include food, petrol and taxes in its inflation index. This is similar to the Reserve Bank of Australia’s inflation calculation.
But then who needs petrol and food, right?
So it’s not surprising that Jim Rickard’s, over at Strategic Intelligence, argues that there’s no worse forecaster in the world than the US Fed.
You may have noticed each year that Australian healthcare companies raise their premiums by roughly 6%. Well, costs are also rising over in the US.
I’ve been speaking to many US citizens up here at the conference. The word on the street is that Obamacare is one of the worst policies of all time. It’s legally forced those who can’t afford health care to buy; at the same time, hiking insurance premiums for those who require modest healthcare.
And it’s only going to get worse…
Now, after two years of being relatively stable, premiums are going to skyrocket. New Mexico, for example, is about to see a 51.6% jump in costs next year. No doubt this will squeeze the US economy even more.
So Eric Sprott is correct…yet again. The general level of prices across the economy has been increasing. You’ve probably noticed the same thing here in Australia — food, healthcare, education, etc. — It’s all going up!