Here at the True Dollar Journal, I have stressed many times that no one can see what is happening in the economy as long as persons rely upon prices and sums quoted either in nominal dollars or in "real" dollars. Real dollars quotations simply are as bogus as current dollar quotations.As I explained in "REAL" GDP IS FAKE, BOGUS, CRAP. AMERICANS AND SCHOOL CHILDREN HAVE BEEN HOODWINKED FOR DECADES, the base used for deflated current dollars are past inflated current dollars. There is no way you can measure any distance with a ruler that keeps growing. Yet, this is what academicians and bankers at the Federal Reserve would have you believe you can do with respect to prices under a fiduciary monetary system.
Once you see the economy through True Dollars™, the only way to discount for inflation in the USA under the fiduciary monetary system, everything makes sense.
At long last, it would seem the Greenspan-Bernanke Great Depression, the massive decline in the economy that began after the blow up of the Greenspan-Bernanke Great Inflation, the greatest credit bubble in the history of mankind, has come to an end. Right now the economy is trading at September 1996 or April 1973 levels.
At peak GDP measured in True Dollars, Loans-to-Prime Working Age (25-54) population traded at 75.6 times the long run average. You should expect Loans-to-Prime Working Age to trade at a multiple above the long run average during the peak of good times. Today, that ratio trades at -6.7% below the long run average.
You should expect economic life to be more the way it was for Americans between the years of 1971 through 1993 than between 1994 and 2007. Without the net massive speculative transformation in the economy like the Internet and without a foolish central banker like Alan Greenspan, there is little reason to believe there will be another great credit inflation.
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