Skip to Content

Paul Craig Roberts. Photo supplied

The economic outlook is just another manipulation

As some readers have remarked in their messages to me, I ceased a while back my monthly reports on the Bureau of Labor Statistics jobs reports and inflation rate. The reason is that the numbers are not good enough to be able to discern what is the actual state of the economy. Yet every new number is treated with attention by the financial presstitutes.

Published: December 1, 2022, 7:05 am

    Read more

    The reports in the financial media make no sense. We hear simultaneously that consumer confidence is high but that a number of large firms are laying off 10 000 employees each, that credit card debt is reaching new highs, that housing prices are falling, but employment and inflation are high, that 90 percent of Americans are more in debt than ever. These are not reports that form a consistent pattern.

    I sometimes wonder if they are creating a world of randomness for us in which we lack a grasp on that is happening.

    But I haven’t turned my back to economics. Twice recently I have written about the Federal Reserve’s inflationary policy and concluded that it is mistaken.

    The Federal Reserve is treating the current inflation as if it is demand driven. This is an obvious mistake, so obvious that it is impossible for the Federal Reserve not to know it.

    An excess demand inflation–“demand pull” in the parlance of neoliberal economists–does not appear suddenly as a spike, as the current inflation has. Excess demand inflations creep up over time as monetary expansion outruns the growth of supply. We get month after month of reports of upward ticks in inflation until the Federal Reserve says “enough” and slams on the monetary brakes.

    There is another kind of inflation that neoliberal economists call “cost push.” This inflation is caused by something happening to supply–a strike by unions, a hurricane that closes down refineries, a drought that reduces food supply, a war that disrupts supply chains, tax rates that choke off output.

    The inflation we are experiencing now is the result of the Covid lockdowns that stopped production and Washington’s sanctions against Russia that mainly fall on Europe and have disrupted business relationships and energy delivery, resulting in a sudden spike in prices. The current inflation is a supply-side, not demand-side inflation.

    As the current inflation is entirely a supply disruption inflation caused by the absurd policies of the Biden regime, the Federal Reserve’s demand-side remedy is useless. Indeed, the Federal Reserve’s policy makes the inflation worse, because higher interest rates raise the cost of production, thus raising prices and contributing to the inflation.

    Actually, profit-maximizing evil might be the heart of the Federal Reserve’s policy. The interest rate on a mortgage is the primary determinant of the demand for homes by individuals. By driving up the cost of carrying a mortgage with its high interest rate policy, the Federal Reserve is freeing up homes for purchase by private capital companies for investment as rental properties. In effect, whatever the Fed’s intention, the Federal Reserve is reallocating housing from individuals to the portfolios of private investment companies.

    The Federal Reserve was created by the large New York banks to protect them from their own mistakes. Over time the Federal Reserve has gained protection from the media, answers congressional oversight committees in incomprehensible language, and supports the agenda of whoever it is that rules us.

    Consider donating to support our work

    Help us to produce more articles like this. FreeWestMedia is depending on donations from our readers to keep going. With your help, we expose the mainstream fake news agenda.

    Keep ​your language polite​. Readers from many different countries visit and contribute to Free West Media and we must therefore obey the rules in​,​ for example​, ​Germany. Illegal content will be deleted.

    If you have been approved to post comments without preview from FWM, you are responsible for violation​s​ of​ any​ law. This means that FWM may be forced to cooperate with authorities in a possible crime investigation.

    If your comments are subject to preview ​by FWM, please be patient. We continually review comments but depending on the time of day it can take up to several hours before your comment is reviewed.

    We reserve the right to del​ete​ comments that are offensive, contain slander or foul language, or are irrelevant to the discussion.


    The inflation hoax

    Yes, prices are rising, but not for the reasons the Federal Reserve says. When I say inflation is a hoax, I mean the purported cause is a hoax. The Fed is fighting a consumer inflation, a “demand-pull” inflation. But what we are experiencing is a supply-side inflation caused by the Covid lockdowns and economic sanctions that closed businesses, disrupted supply chains, and broke business relationships while reducing energy supplies to the UK and European countries, thus forcing up costs in a globalized economy.

    Two-Party Pox: The Republicans suck and the Democrats want to kill you

    The Republican Party has never stood up for Americans, will never stand up for them and is not going to do what it takes. Past is prologue.

    Russia’s loss at Kharkov highlights crippling shortage of men

    KharkovThe frontline in this case relied on heavily outnumbered 2nd rate Lugansk draftees plucked from the LPR.

    A country without an honest media is lost

    For some time I have reported to you that in place of a media, a media that our founding fathers relied on to protect our society, the United States has had a propaganda ministry whose sole purpose is to destroy our society.

    Sweden’s decaying democracy

    A journalist is arrested and dragged out of the Gothenburg Book Fair because he politely asked a powerful politician... the wrong questions about his support for the ethnically-cleansed Zimbabwean dictatorship. Not only journalists, but academics and bloggers are being hounded by the leftist establishment daily. And the leftists have all the nasty instruments of the state at their disposal. Citizen reporter Fabian Fjälling looks into their excesses.

    The geopolitical future of Nordic countries

    Between unity and disunity, independence and foreign interference: Nordic countries have to either choose between creating an independent neutral block in the North, or seeing the region being divided between the great powers.

    Russian, Chinese intelligence: ISIS heading for Central Asia with US cover

    Operatives of the crumbling Islamic State in Syria and Iraq (ISIS) are moving to new battlegrounds near the Russian border, intelligence sources have revealed.

    The unraveling of US/Russian relations

    Washington has taken nuclear war against Russia from a hypothetical scenario to a real danger that threatens the future of humanity. 

    Hero commander killed in Syria – when the war is nearly won

    For most Syrians it came as a shock: One of the most popular military commanders of the Syrian Arab Army, Issam Zahreddine, was killed on 18 October 2017.

    What Is The Obama Regime Up To?

    Obama has announced new sanctions on Russia based on unsubstantiated charges by the CIA.

    Go to archive