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The word stimulus is becoming a recurrent term in the American economic narrative, some may even say that it is oftentimes overused. The definition of stimulus according to the dictionary is “a thing that rouses activity or energy in someone or something; a spur or incentive”. In addition to spur and incentive, other synonyms for stimulus are boost, impetus, prompt, provoke, etc. Recently, the discussion about stimulus checks is getting increasingly heated. Every side has a different take and the population also has some pretty strong opinions. But economists are warning that stimulus doesn’t always stimulate. In fact, it can cause the exact opposite effect and set us up for an economic disaster.
There’s only so much money printed out of thin air can do to actually boost the economy, and after we hit that point, what seems to be a plan to support American workers, in reality, only accelerates our economic deterioration by decreasing the purchasing power of our dollars, compromising our standards of living and the growth of the nation while sending the prices of goods and services continuously up. But most people are not aware of that, and solely thinking about the immediate effects that a liquidity injection could provide for their finances, especially in times of crisis, many are willing to overlook the consequences.
For certain groups, it can be a life or death matter, but for the majority of Americans that had jobs and prospects of their own before the health crisis started, falling into the liquidity trap might turn them eternally reliant on federal help. And, apparently, this process has already begun, as many have been furiously reacting to the latest $600 stimulus checks and demanding for more. That’s what we’re going to expose in this video.
Just as artificial stimulants, such as certain drugs, there is a common expectancy that positive effects arise from its use. But after some time, the so-called positive effects of the stimulus lose potency and fade away. Therefore, higher doses and more frequent use of the stimulus are necessary to get the same original results.
After the first round of distribution of stimulus checks to the population last April and since then, there has been a rising resistance about passing out additional stimulus checks. When the latest checks were authorized, the $600 amount was considerably smaller than the first checks of $1200. Many representatives argued that the first round of stimulus checks to individuals haven’t presented their desired impact. The main target and purpose were that the recipients of the checks spend the money, in that way, reinserting it back into the economy, but evidence shows that much of it was held or saved.
As the financial strategist Adam Hayes explained, the stimulus money intended to boost the economy isn’t actually making its way back into the economy, so it isn’t actually stimulating anything, an event economists call “pushing on a string”. “Pushing on a string is a metaphor for the limits of monetary policy and the impotence of central banks. Businesses and households cannot be forced to spend if they do not want to. Increasing the monetary base and banks’ reserves will not stimulate an economy if banks think it is too risky to lend and the private sector wants to save more because of economic uncertainty.”
Regardless of the warnings of experienced experts, authorities will keep endlessly passing stimulus checks after stimulus checks, increasing the national debt and failing to properly support workers and the economy. Biden’s plan will essentially fulfilling the dream of America’s central planners. Those who are subscribers to our channel might already be familiar with the plan by now, but for those who are not, let’s just say the plan includes locking down the economy, bankrupting small businesses, and then keep stimulating consumer demand with artificial money. In a finger snap, the central planners took control of the population, the economy, and financial markets.
The Bureau of Labor Statistics’ consumer price index increased by 1.4 percent over the past year. But even though prices keep climbing, the U.S. unemployment rate remains at 6.7 percent. That puts the misery index, which is the sum of the unemployment rate and the inflation rate, at 8.1 percent. And given that we’re on a path that will lead to higher rates of unemployment and higher inflation, soon a misery index above 10 percent will certainly bring much more civil agitation, delinquencies, social turbulence, and crime.
The quality of money comes from its quantity. The seeds of free money have been sown. Now fruits of inflation are blossoming as our living standards and our purchasing power decompose over the rotting roots of our economic system.
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