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CNN Says High Prices Are Good for You – Swamponomics

Plus, Austrian economics and the state of Trump stock.

by | Apr 17, 2024 | Articles, Business News, Opinion

You will pay higher prices and be happy. As a second wave of inflation appears imminent, CNN is running damage control for the current administration months before the November election. The cable news network is spinning the renewed inflation threat by attempting to convince the public that the US economy will not return to pre-pandemic prices, which is a positive for businesses and consumers. This is essentially the consensus opinion nowadays, with the White House conceding that the sticker shock is the new normal. And – if one trusts the “most trusted name in news” – that’s a good thing!

CNN Loves Inflation Now

CNN decided running a video segment titled “Lower prices may sound nice, but they’re a bad sign for the economy …” would be a terrific idea to endear itself to the public. Host Vanessa Yurkevich told viewers: “As much as it would be great to see prices drop, we’re never going to pay 2019 prices again.” She explained that lower prices are bad for everyone and that “deflation is something we don’t want to see” because it will lead to higher unemployment and falling wages amid less demand for goods and services.

The funniest part of the roughly two-minute clip was when Yurkevich asserted that the “Fed is doing everything in its power not to let” deflation happen. Yes, the American people feel this daily with their reduced purchasing power! Another aspect of the report defined the central bank’s 2% target rate as “that’s what we’re all used to.” Why, Ms. Yurkevich, is it 2%? Fed Chair Jerome Powell doesn’t know.

In the end, she admitted that today’s climate feels painful. Why? Because the very thing causing misery, suffering, and unhappiness is inflation. While CNN can be poked fun at for championing the concept of expanding the money supply and trimming the value of the money in your pocket, economists have been touting the same snake oil for decades. The “experts” purport that inflation generates prosperity. This is accurate, but the results are unequal. The 40% increase in the money supply during COVID-19 benefited those closest to the printing press, an economic theory known as the Cantillon Effect. The Eccles Building recently published a study that found the top 1% has increased their wealth by $15 trillion to an all-time high of $45 trillion since the pandemic. Powellflation produced euphoria for everyone at the beginning. However, as the freshly created money traveled through the economic landscape, low- and middle-income households were given devalued money, meaning it now requires more dollars and cents to purchase the same or less amount of goods and services.

Of course, this is not the first time that CNN and its media counterparts have uttered falsehoods. In January 2021, when the data showed that inflation was not transitory, CNN published this hilarious article: “Why inflation can actually be good for everyday Americans and bad for rich people.” In December 2023, The Atlantic claimed that “Inflation Is Your Fault.”

Even the so-called experts put out dubious content. In a December 2021 X post, Paul Krugman stated: “‘Inflation especially hurts the poor’ has truthiness — it sounds like it should be true. But I don’t see either evidence or a mechanism.” Morris Pearl, a former managing director of BlackRock, wrote, “Many Americans, particularly the less wealthy, actually stand to benefit from higher levels of inflation.”

Austrian Economics

Rather than CNN’s Keynesian message, maybe the network needs to run a marathon of this message courtesy of UFC fighter Renato Moicano: “If you care about your [expletive] country, read Ludwig von Mises and the six lessons of the Austrian economic school, [expletive].” He also went to X on April 14: “#ufc 300 I said and will say again if you care about the truth start to read mises … 6 lessons changed my perspective on money inflation and politics!!!”

Wait a minute. What is this Austrian Economics a UFC fighter is screaming about? Austrian theory is an economic extension of libertarian thought that emphasizes individualism and voluntarism and concentrates on human action as the basis of all analysis. But rather than dwell on the intricacies, the six lessons the mixed martial artist refers to are found in the legendary economist’s book Economic Policy. Here is a breakdown:

  • Business Cycle Theory
  • Economic Calculation Problem
  • Individualism
  • Human Action
  • Spontaneous Order
  • Subjective Value

Trump Media

If you bought at the top of Trump Media and Technology Group (TMTG), also known as DJT on the Nasdaq Composite Index, then good luck! Ever since hitting an all-time high of $79.38 late last month, emulating the pandemic-era meme stock frenzy, shares have been in freefall and have plummeted as much as 66%. The stock’s demise started after Truth Social reported a $58 million loss. The decline intensified on April 15 when the company filed a plan to the Securities and Exchange Commission to offer more than 21.4 million shares of common stock. It is unclear when the shares will hit the market or if they will flood the equities arena at once.

The presumptive Republican nominee cannot touch his majority stake until the six-month lockup provision is finished, which will be in September. When the stock debuted on Wall Street, he was poised for a massive payday. However, if DJT shares maintain their downward trajectory, there might not be as much value in the coming months.

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